Fabio Araujo, director general of the Brazilian Central Bank, praised the characteristics of bitcoin, saying it is a financial innovation using new technology. Araujo said that bitcoin was the catalyst for what is today called Web3. Araujo also commented at one event on the status of the digital real’s development, saying that the institution hopes to add smart features to the currency.
Central Bank of Brazil Praises Bitcoin as a Pioneer in Web3 Technology
More and more central banks around the world are grappling with the issue of cryptocurrencies and how to innovate to keep up with these technologies. Fabio Araújo, director of Brazil’s Central Bank, praised Bitcoin as the financial innovation that gave birth to the Web3 movement, and said that a digital real still under study, the Central Bank Digital Currency (CBDC), may have programmable features.
At an event promoted by the São Paulo Business School, Araujo said,:
Bitcoin was launched in 2009 and began to accelerate this with distributed database technology that facilitates the creation of web3 Bitcoin’s application brings a proof-of-work solution, which is fundamental to the services that Web3 brings to people.
In addition, Araujo has stated that the technology predates Ethereum and includes smart contracts that bring more possibilities to the financial system.
Programmable Digital Real
Araujo also touched on the digital real, suggesting it could have smart capabilities. A series of slides presented at the event showed the central bank’s digital currency linked to three web elements: digital assets, tokens, Internet of Things (IoT) protocols, and offline payments.
The central bank director also makes a clear distinction between digital reals and other crypto assets such as Bitcoin. Araujo stated.
CBDCs are not crypto assets even if they use technology that supports crypto. CBDCs are a representation of the real in the environment in which cryptocurrencies operate, just as the real does not compete with listed assets.
Araujo explained that the digital real is an opportunity to bring smart capabilities to bridge the gap that exists between traditional finance and Web3 protocols. The bank has experimented with various experiments with the Digital Real concept, but a decision on whether to launch or shelve the project will be made in 2024.
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