2021: Brazil’s year of mass adoption of cryptocurrencies

2021 was a year that was positive for the Brazilian crypto market. There were good news in Brazil’s stock market and the promise of a CBDC.
The BRL/BTC pair was stuck below 200,000 reals until August, when it began to rise to a new historic high of 367,000 real on Nov. 8. The BRL/BTC exchange rate was hit hard by Bitcoin’s decline. It remained below 200,000 reals for most of the year, but it started to rise to a historic high of 367,000 real in August. According to CoinMarketCap, 10 million Brazilians are now involved in the crypto market. In traditional financial markets, the Brazilian Stock Exchange introduced exchange-traded funds (ETFs), which are linked to Bitcoin and Ether. Five ETFs are already listed on B3, with some of them being among the most profitable in Brazil’s stock market in 2021. The Central Bank of Brazil announced new developments in the digital real (a central bank digital currency) that could be launched as soon as 2023. The Brazilian Central Bank announced that it will continue to work with blockchain technology in its services through a series of tests conducted by a dedicated team at monetary authority. In December, federal deputies approved Bill 22303/15, which established the criteria for regulation of cryptocurrency in Brazil. The bill will be discussed further in 2022 at the House’s plenary and later in Federal Senate. There was some tension among the major players in Brazil’s cryptocurrency market in 2021. But there was also some good news. Brazilian exchanges faced off against Binance, a major crypto exchange. The Brazilian Cryptoeconomy Association worked with exchanges across the country to ensure that Binance complied with rules set by the Brazilian Securities and Exchange Commission and Federal Revenue Service. The global exchange is still in negotiations with Brazilian market regulators. MB worked with Chiliz to make fan tokens easier to access for Brazilian fans. This novelty was adopted by Brazilian football giants like Corinthians, Sao Paulo and Internacional as well as other major Latin American companies. The Brazilian Stock Exchange hopes to expand its offering of cryptocurrency-linked investments, with experts targeting decentralized finance (DeFi), NFTs and the Metaverse.It’s also worth remembering that 2022 is an election year in a country that has been polarized since 2016, with the Bolsonaro government suffering from low popularity and being defined by social tension. The direction of the digital real and the future of Brazil’s economy, including cryptocurrency markets, could be affected by the elections.

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