#186: Brazil Needs a Bitcoin Reserve, says VP's Chief of Staff
Plus: Coinbase lays out objections to proposed Central Bank rules, Mercado Bitcoin & Mantra to tokenize US$200 million in assets
Olá pessoal!
Welcome back to 🇧🇷Brazil Crypto Report for the week of April 7-11. I hope everyone is maintaining their sanity as we push ahead with tariff news out of the US. My approach is a bit neanderthalic — I’m just ignoring it for a few days until the dust settles and we can draw some firm conclusions.
Also, I’ve created a special Telegram group for BCR readers and listeners, with the goal of creating a space where locals and gringos involved in the industry can connect. You can join at this link.
🔎 What’s in BCR this week?
Parfin says Rayls solves the Drex trilemma, will become open source
Mercado Bitcoin partners with Mantra to tokenize US$200 million in assets
Coinbase lays out objections to proposed Central Bank crypto rules
Ex-Central Bank President Franco Launches RWA Token
Microsoft, EY scale back Drex involvement
Brazil needs a bitcoin reserve, says VP Geraldo Alckmin’s Chief of Staff
Thanks for reading and have a great week!
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This week’s episode is with Banco Inter’s digital assets and emerging technologies gigabrain Bruno Grossi, recorded onsite at Merge Buenos Aires last month. We talk about Inter’s 20 year journey as Brazil’s first digitally-native bank, its various initiatives in the digital asset realm — such as its work in the Drex pilot alongside Chainlink and Microsoft, and his views on how other emerging technologies like AI and quantum computing will impact Brazil’s banking sector.
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Parfin says Rayls solves the Drex trilemma, will become open source
Rayls, developed by Parfin and one of the five privacy tools being tested in the Drex pilot, is able to meet the requirements laid out by the Central Bank — the so-called Drex Trilemma of programmability, decentralization and privacy, company claims.
None of the privacy solutions were able to meet these requirements during the first phase of the pilot, but the new updated version of Rayls solves for these problems, says CEO Marcos Viriato. This claim will be proven out in the ongoing second phase of the Drex pilot.
The only remaining problem is that Rayls is a proprietary tool and not open source. The Central Bank has been prioritizing open source tooling so as not to encounter vendor lock-in.
Viriato told Valor that the roadmap is to make Rayls open source, noting that it has joined the LF Decentralized Trust (formerly known as Linux Foundation) to facilitate this:
“It is part of our schedule to make Rayls components “open source”. Every blockchain protocol does this, and it would be no different with us.”
The transition is expected to be completed in the third quarter of this year.
Microsoft, EY scale back Drex involvement
Meanwhile, certain other vendors involved in servicing the Drex CBDC pilot are putting the brakes on their participation in the project, Brazilian newspaper Valor reports.
Microsoft and EY, which respectively developed the ZKP Nova and Starlight privacy solutions used in the first phase of the pilot, began scaling back their involvement at the end of last year.
Recall that none of the privacy solutions tested by the bank during the first phase were able to meet the Central Bank’s requirements.
The ZKP Nova tool emerged as a possible solution to be tested in the pilot’s second phase, but Microsoft has since decided reduce its focus on Drex after devoting significant resources to it in 2024. ZKP Nova will continue to be tested in the second phase by tokenization and infrastructure company Hamsa.
Valor reports that the three staff that EY had dedicated to Drex testing have since moved on, though the company says is still officially continuing with the project. Sources interviewed by the newspaper insinuated that Starlight is not capable of meeting the bank’s lofty requirements.
The challenge for these vendors is two-fold: first is that of building a technical solution that anonymizes transactions within the Drex network while still allowing the Central Bank full visibility as a supervisory node. Second is a perceived lack of enthusiasm for the project by new bank president Gabriel Galipolo — though its unclear if the lack of enthusiasm is simply due to more pressing priorities.
Brazil needs a bitcoin reserve, says VP Alckmin’s Chief of Staff Guerra
Brazil needs a Bitcoin Reserve to be able to implement large national projects in the future, such as access to basic sanitation and improvements to education services, argued Pedro Guerra, chief of staff to vice president Geraldo Alckmin.
However, he emphasized that this is not the position of the government and potential enactment depends on the coordination of several agencies and entities.
Speaking on the Fernando Ulrich podcast, he explained:
“We need to reflect: what kind of world is this that we are in after the 2008 crisis? This is the answer that Bitcoin seeks to offer.”
“If we want funds for things like universal sanitation, communications, and more investment in school infrastructure, we need more money and money with more purchasing power, money that is worth more. And Bitcoin, in a very simple way, by appropriating very basic premises of abundance and scarcity, offers answers.”
Portal do Bitcoin CoinTelegraph Brasil Exame Livecoins
Mercado Bitcoin partners with Mantra to tokenize US$200 million in assets
MB is partnering with RWA tokenization focused blockchain Mantra to expand its offerings of tokenized assets internationally.
Mantra has inked several tokenization agreements in the UAE with real estate developers to tokenize property, hospitality and data centers and other sectors.
The partnership aims to integrate MB’s tokenization solutions with Mantra’s blockchain infrastructure and create a more scalable and efficient financial environment for institutional investment needs.
Fabricio Tota, VP of New Business at Mercado Bitcoin, said:
“This partnership reinforces our position as a leader in tokenized assets. MANTRA’s blockchain technology enables us to offer more efficient and cost-effective investment products while expanding the participation of international investors. With MANTRA’s specialized infrastructure for tokenizing RWAs, MB is poised to expand its role as a leader in both the financial and technology sectors in the global market.”
John Patrick Mullen, CEO of Mantra, said in a statement:
“At MANTRA, our focus is on providing developers and institutions with a Layer 1 blockchain built for RWAs that can meet real-world regulatory requirements. We want to bring the global financial ecosystem to the blockchain, and by partnering with MB, we are tapping into not just a new region and market, but a range of communities that share our interests.”
CoinTelegraph Brasil CriptoFacil
Ex-Central Bank President Franco Launches RWA Token
Rio Bravo Investimentos, an asset manager founded by former Brazilian Central Bank President Gustavo Franco, announced a new RWA token linked to investment portfolios. Franco was one of the key architects of the Real Plan that slayed Brazil’s inflation dragon in 1994.
The tokenized management portfolio product is called Poupah! Gal Barradas, director of growth at the company, explained that the product allows democratized to sophisticated investments via three pre-defined portfolios: conservative, moderate and bold.
"The investor answers a few simple questions, makes a Pix and the allocation happens automatically, following a strategy aligned with their risk profile."
The underlying tech for the product was developed by BlockBR. It uses RWA tokens for automated rebalancing, reinvestment and daily liquidity, with redemptions available at any time.
CoinTelegraph Brasil Livecoins
CVM approves BEE4 to operate outside regulatory sandbox
Brazil’s securities regulator approved BEE4 as the first tokenization company to operate outside of its regulatory sandbox after being granted an organized counter license
It’s the first time a company participating in the CVM regulatory sandbox has “graduated”, so to speak, from the program. BEE4 now has obtained all of the licenses, including a central depository license, necessary to expand its operations in Brazil.
BEE4 operates a blockchain-based regulated secondary marketplace for trading shares of small and medium-sized companies with up to R$500 million in annual revenue.
With its current set of licenses, the company can facilitate trading of fixed and variable income products, offer services for registration, safekeeping and settlement of transactions, and handling corporate events and securities movements (registering these on blockchain).
Patricia Stille, co-founder and CEO of BEE4, said in a statement:
"With the definitive OTC and Depository licenses, we are taking a crucial step in the development of a new market that has been built to prosper for generations. This achievement allows us to boost those that can become the future great Brazilian companies, offering both alternatives for access to credit in the capital market and share offerings. Our next step is to start operating under the EASY Regime, after the publication of the new resolution, scheduled on the CVM's agenda in 2025.”
BlockNews CoinTelegraph Brasil
Coinbase lays out objections to proposed Central Bank crypto rules
Fabio Plein, Coinbase’s director for the Americas, laid out the exchange’s objections to several rules proposed by Brazil’s Central Bank in an op-ed for Valor Investe.
Specifically, there are rules proposed that would negatively impact foreign entities and make it more difficult for the bank to achieve its stated regulatory outcomes.
“We understand that some additional obligations imposed on foreign custodians may, in practice, make it impossible to achieve the advances sought by the Central Bank and the market.”
Plein argues that a foreign custodian that already meets relevant Brazilian standards should not be penalized due to a lack of a formal agreement between the US (where Coinbase is headquartered) and Brazil on this specific matter.
Per the op-ed, Coinbase is also in favor of a framework that allows Brazilian clients to access global order books. It also opposes a proposed rule requiring that transactions of stablecoins denominated in a foreign currency between Brazilian VASP users be included in the foreign exchange market, as well as other limitations on these transactions:
“In our view, since these are transactions purely between residents, there is no need for said transactions to be included in the foreign exchange market, resulting in very difficult reporting and compliance obligations for a sector that is still in its infancy.”
🗞Brazil Crypto News Rundown
📈 Markets
Brazil is becoming a global leader in asset tokenization, according to a thorough new report by ABCripto. The group said:
"With a daily volume of R$23 billion moved in cryptoassets and more than 9.1 million individual investors in the country, Brazil is at the global forefront of tokenization. The ABcripto study reinforces that this trend should grow in the coming years, making the financial market more accessible, efficient and dynamic.” (CoinTelegraph Brasil)
Arkham intelligence has begun monitoring the wallets of Brazil’s major crypto exchanges. (Livecoins)
Bitget is eyeing the RWA token market in Brazil, according to COO Vugar Usi Zade. He told CoinTelegraph Brasil:
"Brazil is a hotbed of crypto adoption and a hub for innovation in real-world assets, and Bitget is fully committed to supporting this growth. With Brazil's RWA market ranking third globally and projects tokenizing millions in assets, how could we not be excited about deepening our presence here?
📲 Adoption
Binance relaunched its Binance Wallet in Brazil. Previously known as the Binance Web3 Wallet, the tool aims to make accessing crypto easier for users. Users in Brazil will have access to Megadrop, a token launch platform with rewards for eligible participants. (CoinTelegraph Brasil) (CriptoFacil) (BeinCrypto)
CNBC in Brazil launched a new program on cryptocurrencies called Cripto Brasil
Criptomaniacos founder Felipe Menezes has founded Altside, a consultancy focused on helping high-net worth individuals from traditional finance enter into crypto. (CoinTelegraph Brasil)
Brazilian banks are expected to invest R$47.8 billion in technology this year, up 13% from 2024, according to the Febraban Banking Technology Survey 2025. The report also found that AI will reduce banks’ costs by as much as 75%. (BlockNews) (BeinCrypto)
Chico Bento, a character for the Turma Monica kids series, is now on Roblox, as a result of a partnership between Trexx, MSP Estudios and InspireIP. (BlockNews)
Former Formula 1 driver Rubens Barrichello spoke to CoinTelegraph Brasil about his current work in tech, startups and crypoto.
TokenNation, formerly known as NFT Brasil, will take place June 4-5 at the Sao Paulo Biennial Pavilion.
Brazil’s Central Bank and Fenasbac will host LIFT Day 2025 at the bank headquarters on April 30, where several blockchain solutions and innovations for Pix, Drex and an interoperability study by Polkadot and Ripple will be presented. (CoinTelegraph Brasil)
AI companies like OpenAI, Google, Meta and DeepSeek are not abiding by Brazil’s General Data Protection Law, according to a study released by Getulio Vargas Foundation. (CoinTelegraph Brasil)
🏛 Policy, Regulation and Enforcement
The Central Bank is advocating for a change to proposed stablecoin law that would restrict the definition of stablecoins exclusively to crypto assets pegged to fiat currencies. This is to bring the definition in line with international standards and prevent potential conflicts with the CVM. Antonio Guimaraes, a consultant for the bank working on crypto regulation, said:
“If we allow under the concept of stablecoins the representation of a set of assets, which could include, for example, debentures or company shares, this could simulate an investment fund, which are currently fully regulated by the Securities and Exchange Commission, as well as simulate the trading of other financial assets that already have specific regulation by the Central Bank, avoiding a series of commands, compliance costs and risk prevention that could be used through regulatory arbitrage.” (CoinTelegraph Brasil)
The B3 stock exchange has released a guide on how to declare cryptocurrency ETFs on income tax returns. (Valor) (CoinTelegraph Brasil) (BeinCrypto)
“King of Bitcoins” Claudio Oliveira, who operated a large bitcoin pyramid scheme before being arrested in 2021, was spotted in Curitiba walking in front of the building that previously housed his company, Bitcoin Banco.
A case in which a YouTube influencer embezzled R$3.6 million in cryptocurrencies from an elderly couple in Campo Grande is being investigated by Civil Police of Mato Grosso do Sul. (Portal do Bitcoin)
A strike by fiscal auditors at the Receita Federal is delaying the publication of cryptocurrency transaction data collected by the agency. (Livecoins)
Brazil’s Chamber of Deputies has created a special committee to analyze AI regulation. (CoinTelegraph Brasil)
Central Bank President Gabriel Galipolo emphasized during a special congressional hearing on betting websites that the bank has limited oversight over the platforms because they do not provide financial or payment services. (CoinTelegraph Brasil)
The CVM issued a warning about the XLNTRADE trading platform, stating that it does not have authorization to offer securities or cryptocurrencies in the country. (CriptoFacil) (BeinCrypto)
Civil Police in Goias executed a search and seizure warrant against a former local official accused of embezzling public funds and hiding them with cryptocurrency purchases. (Portal do Bitcoin)
Federal Deputy Luiz Philippe de Orleans e Bragança introduced a bill that would allow companies to pay employees up to 50% of their salary in cryptocurrency. (Portal do Bitcoin)