Brazilian Central Bank Director Praises Bitcoin

The Central Bank of Brazil’s Director, Fabio Araujo, lauded Bitcoin’s features, calling it a financial innovation that employs new technology.

Bitcoin, according to Araujo, provided the impetus for what is now known as Web3. Araujo also spoke on the changing condition of digital money during an event, stating that his business aims to add smart functionalities to the currency.

Central banks all around the globe are grappling with the issue of cryptocurrencies and how to innovate to stay up with these technologies.

The Central Bank of Brazil’s director, Fabio Araujo, commended Bitcoin as a financial invention that gave rise to the Web3 movement and discussed how the digital real, the central bank digital currency (CBDC) currently being researched, may have programmable capabilities.

In an event promoted by the Sao Paolo Business School, Araujo stated:

“We started to accelerate this in 2009, with the launch of Bitcoin, with distributed database technology that facilitates the creation of Web3. The Bitcoin application brings the Proof of Work solution, which is a fundamental thing for the services that Web3 brings to the population.”

Furthermore, Araujo stated that this technology came before Ethereum, which incorporates smart contracts that expand the financial system’s capabilities.

The central banker has also clearly distinguished between the digital sector and other crypto assets like Bitcoin. Araujo says:

“Even though CBDC uses the technology that supports crypto, CBDC is not a crypto asset. The CBDC is an expression of the Real within the environment in which cryptocurrencies operate, in the same way that the Real does not compete with listed assets.”

According to Araujo, the digital real was a chance to provide smart functionalities to bridge the current gap between traditional financial and Web3 protocols. While the bank has conducted some trials concerning the notion of the digital real, the decision to launch or cancel this initiative will be made in 2024.

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