The President of the Central Bank of Brazil, Roberto Campos Neto, said in Roda Viva (13) last Monday that the pilot program for the country’s new currency, the digital real, should start soon.
The speech came in response to the show’s host, Vera Magalhães, asking Campos Neto what his focus is on the latter part of his tenure as central bank president.
In response, Neto said he is not only working to reconstitute the central bank’s staff after the 2022 strike, but also hopes to unite the PIX with Open Finance and the digital Real by 2024.
What is the Real digital pilot program that should start soon?
A pilot is an experimental version of a system, developed and tested in a controlled environment before going into production.
Thus, the purpose of a pilot program is to identify and correct potential problems and failures before the program is released to the general public. Since the digital real is the new currency project for Brazilians, the central bank is cautious about its launch.
In a pilot program, it is common to select a limited group of users to test the solutions. For example, China launched its version of the digital yuan after testing with the country’s banking sector and technology companies.
Speaking at Roda Viva, Roberto Campos Neto stated that by the end of his tenure, in December 2023, he expects to realize the development agenda, with PIX integrated into Open Banking and Real digital.
“We have a very big agenda to deliver, so my second priority is to continue the agenda. I would like to connect, in the digital world we had three big blocks, I would like to connect the blocks, which is the PIX, to Open Finance, to the digital currency. We already have the digital currency pilot, which will start soon. I think these three things can change the history of financial intermediation in Brazil, transform our system into something efficient and today there is no one in the world that is so advanced. We are thinking about instant payments with PIX, together with Open Finance and creating a digital currency.”
Is a CBDC different from cryptocurrencies?
A CBDC (Central Bank Digital Currency) is a digital currency issued by a central bank that is an electronic form of money backed by the country’s monetary authority. In other words, it is a form of digital money that is issued and guaranteed by the government.
Unlike this system, cryptocurrencies do not have a central authority, especially Bitcoin, a decentralized digital currency.
The digital Real is thus a project under development by the Central Bank of Brazil to create a digital version of the Brazilian currency.
The goal is to modernize the financial system, increase the efficiency of transactions and reduce costs. Like other CBDCs, the digital Real is a currency issued by the Central Bank and its value is tied to the physical Real.
The project will go through a study and testing phase in 2023 and there is still no forecast for its official launch. In any case, it is expected that the coin will be operational in 2024.
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
