#147: Cardano founder Charles Hoskinson to keynote Blockchain Rio
Plus: Banco do Brasil tests offline Drex payments; Receita Federal says it can examine Binance in its tax probe
Olá pessoal!
Greetings from Brussels and welcome back to 🇧🇷Brazil Crypto Report for the week of July 1-5, 2024!
I’m at for EthCC this week — if you’ll be around and want to grab a Stella feel free to ping me on Telegram @AaronStanley. I’ll be hanging around the Filecoin Foundation Network Base event July 8-10, and then in the main conference on the 11th and 12th.
I would like to pay a quick tribute to the 30th birthday of the Brazilian Real 🎉 The Plano Real was one of the most successful monetary experiments in history. It implemented a temporary dual-currency system to simultaneously transition away from the deprecated Cruzeiro currency while introducing the Real. The end result was that Brazil was able to successfully fight off the runaway hyperinflation that it had suffered through for years.
In the years since, the Real has suffered the same fate as even the strongest of fiat currencies, as it has lost something like 80% of its purchasing power since first being introduced. Nevertheless, the Plano Real is a pretty fascinating study for those interested in monetary history.
I did a short summary piece on Linkedin if you want to learn a bit more.
🔍What else is in this week’s BCR?
Cardano founder and Ethereum co-founder Charles Hoskinson will speak at the Blockchain Rio event July 24-25
Banco do Brasil tests offline Drex payments
The Receita Federal says it has the necessary authority to examine Binance as part of its compliance probe
Thanks for reading and have a great week!
-AWS
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New podcast!
For this week’s episode I talk to Daniela Barbosa, Executive Director of the Hyperledger Foundation and General Manager for Blockchain and Identity at The Linux Foundation.
As readers of BCR know, the Central Bank of Brazil is deploying its Drex CBDC project on Hyperledger Besu. Daniela and I discuss the current state of the Hyperledger ecosystem, the state of the Hyperledger community in Brazil, and her experience at the Febraban Tech conference last week in São Paulo.
🎧 You can find Brazil Crypto Report content wherever you listen to podcasts: Spotify | Apple Podcasts | Amazon | Anchor | YouTube
Charles Hoskinson to speak at Blockchain Rio
The Cardano founder and former Ethereum co-founder will be onsite at Blockchain Rio, which takes place July 24-25. (BeinCrypto)
Mobiup launches “white label” tokenization tool
Software company Mobiup has launched a platform making it easy for companies to tokenize assets in compliance with CVM guidelines.
Using the platform, companies can develop CRIs, CRAs, debentures, CPRs and consortia on blockchain in the equity crowdfunding model, which for now is the “approved” way of distributing fixed-income tokens.
Rodrigo Caggiano, founder of Mobiup, told Valor that the issuer is able to originate the token on either the first or a second Ethereum layer and then make it available in the platform’s marketplace. The tokenized crowdfunding infrastructure is handled by the platform, which Caggiano says has been audited by the CVM — Brazil’s securities regulator.
Caggiano explained:
We understand that it is a market that will grow a lot, with 60 equity crowdfundings already approved. Today we are tokenizing the Rural Product Certificate [CPR] for AgroMoney, which is a spin-off of Mobiup, in addition to tokenization for the real estate market…We hope to tokenize R$15 million per month with the platform.”
EY talks details on Drex privacy
Thamilla Talarico, blockchain and digital assets partner at EY, explained in more detail the privacy problem that is currently throttling the Drex project.
In an interview with Exame, she explained that with upwards of 70 different financial institutions participating in a network that is transparent and auditable, privacy is an obvious and natural concern:
"Banks, payment institutions, fintechs, exchanges, technology providers, they are all there and are competing agents in the market. Both personal, customer and transactional data are running on the network and could be seen by everyone who is part of it.”
Therefore, Drex needs to guarantee privacy in line with Brazil’s General Data Protection Law; specifically to ensure that other members of the network cannot see with whom an entity is transacting and the value of that transaction.
She explained that EY’s privacy solution, which is being tested in the Drex pilot, brings privacy at the code level, meaning that any smart contract developer can take advantage of the tool:
"The great difference of our solution is exactly trying to make life easier for those who are developing and those who may operate this tool in the future. The interface was created with this in mind, to make it easier and simpler."
Banco do Brasil testing offline Drex payments
The state-owned bank will test offline payments in Phase two of the Drex pilot, using a solution built by German consultancy Giesecke & Devrient.
Julierme de Souza of BB explained:
“We are focusing more on tokenizing assets for investment and using ‘token money’ for offline payments.”
The bank has been studying the creation of a “mega investment ecosystem” inside of Drex through four main fronts: capital markets, sustainability, wallets and the aforementioned offline payments.
Additionally, the bank has built its own platform on Hyperledger Besu for simulating the transfer and purchase of government bonds in the Drex network. The testnet is available for employees across the company to use. BB’s technology director Rodrigo Mulinari said:
“All middle areas and staff from some agencies [bank branches] can test if they want. It’s hands-on training so that our teams know how to serve customers when Drex is working.”
🗞Brazil Crypto News Rundown
📈 Markets
The addressable market for tokenized crops is estimated at R$300 billion (US$60 billion) in the early stages. The number is the amount of business that in the market that occurs through bartering. Anderson Nacaxe of Agrotoken explained:
“Large banks access agribusiness, but investment funds have difficulty [accessing it]. There is a lot of private equity money stuck, unable to enter. With tokenization, there will be more players; This means more credit and lower costs. The producer will start using his currency and will have lower risk.” (Valor)
Mexican used car platform Kavak, one of Latam’s largest startups, tokenized R$5.4 million (US$1 million) worth of commercial notes in partnership with Liqi, the Brazilian asset tokenizer.
In total, Kavak plans to R$30 million (US$6 million) in debt instruments with Liqi.
Oliveira Trust serves as the guarantee agent and bookkeeper for the assets
The first tokens were distributed through a private offering to professional investors; future tokens will have a public offering, pursuant to CVM rules.
Andre Pina, chief business officer at Liqi, said:
“Through tokenization, the possibility of expanding and internationalizing the sale of future tokens is opened up, due to the use of blockchain, as well as the inclusion of other benefits with the token that can please investors and bring them even closer to Kavak.” (Valor) (Portal do Bitcoin)
Rio de Janeiro mayor Eduardo Paes signed a new law opening the door for the city to have its own stock exchange. Currently, the B3 in São Paulo is the only exchange operating in the country. The law provides a set of tax incentives for a future exchange operating in the city. (Portal do Bitcoin)
NovaDAX released its Token Launch Zone that lets users increase their income by trading new tokens. (Web3News)
Former Brazilian footballer turned cryptocurrency promoter Ronaldinho Gaucho took to X/Twitter to promote the BRETT memecoin
📲 Adoption
Roberto Campos Neto, president of the Central Bank of Brazil, is considering opening a bank that only operates with cryptocurrencies when he leaves his post at the end of the year. (CoinTelegraph Brasil)
Carrot.eco, a Swiss startup founded by two Brazilians, have developed a blockchain to tokenize the chain of organic compounds and waste, starting at from restaurants and supermarkets and on to transportation and composting. (Valor) (CoinTelegraph Brasil)
Binance has made 10,000 scholarships available to its blockchain education platform in Brazil. (BeinCrypto) (Livecoins)
Bitget CEO Gracy Chen discussed gender imbalance and opportunities in crypto with Portal do Bitcoin.
BitGo announced that Luis Ayala will assume the role of Brazil country manager. (CoinTelegraph Brasil)
The state of São Paulo will begin issuing National Identity Cards using blockchain starting this month. (CoinTelegraph Brasil)
Yasmin Hund, a former Mercado Bitcoin employee, launched a token supporting her education efforts. She was able to raise the funds required to finance her education at INSEAD in France via Yascoin. Token holders will receive up to 20% of her total compensation upon completion. (Portal do Bitcoin)
Brasilia has prohibited the use of physical money in paying for public transportation. (CoinTelegraph Brasil)
Trexx announced a new microcredit platform for gaming assets. (BeinCrypto)
🏛 Policy, Regulation and Enforcement
The Receita Federal said it does have the authority to carry out inspection actions on Binance, clarifying that the exchange is not outside the scope of its supervision. Recall that a letter signed by Finance Minister Fernando Haddad emerged last month saying that Binance was outside the reach of the tax authority’s probe into the activities of overseas exchanges. The agency said in a note:
“There was a statement from the Federal Revenue, which has technical and legal autonomy to supervise taxpayers in Brazil, informing that there is no direct supervision of companies domiciled abroad, which does not mean that their activities in the country, especially when carried out through companies and people located here, remain free from supervisory action.” (Livecoins)
São Paulo Civil Police seized R$500,000 worth of cryptocurrency mining equipment from a couple that had been stealing R$100,000 worth of electricity a month to run the hardware. (Portal do Bitcoin) (Livecoins)
Ripple announced its support for the Data Privacy Brasil project, which is dedicated to data protection and digital rights. (CoinTelegraph Brasil)
The CVM issued an immediate suspension against Sbarani Administradora de Capitais, meaning that it can no longer manage securities portfolios nor carry out securities-related activities. Sbarani was involved in the Federal Police operation against Titanium Asset. (BeinCrypto)
Fintechs Nomad, Wise and Avenue informed that they are clients of Evolve & Trust Bank, which suffered a data breach in June. (Portal do Bitcoin)
A federal judge has ordered that the assets of 11 former Lojas Americanas directors be seized, including cryptocurrencies that they may hold. (Portal do Bitcoin)
Alexandre de Moraes, a minister of the Supremo Tribunal Federal, ordered the blocking of cryptocurrencies of five people involved in the protests against the Lula government on January 8, 2023. (Livecoins)
Federal Police in Minas Gerais carried out an operation called Terra Fertil in seven states against drug traffickers who were using cryptocurrency. (Livecoins)