Securities and Exchange Commission (CVM) Chairman João Pedro Nascimento shared insights into the potential impact of the development of DREX (Digital Asset Registration and Settlement System) in Brazil, especially on cryptocurrencies.
Presenting at the seminar The administrative sanctions process within the scope of CRSFN and CRSNSP, he said that as the true digital future becomes a reality, there will be a decrease in the attractiveness of several smaller cryptocurrencies circulating on the market.
According to the president, this change would not affect already consolidated and recognized cryptocurrencies, such as Bitcoin It is Ethereumbut it would have a significant impact on smaller cryptocurrencies.
He believes that DREX could reduce the attractiveness of these smaller coins by taking over many of their functionalities.
Nascimento also emphasized that the CVM is working with the Central Bank of Brazil and other regulatory bodies, such as the Financial Activity Control Council (COAF) and the Ministry of Finance, to approach the crypto economy in a conscious and balanced way.
The aim is to recognize the risks associated with the crypto economy, without generalizing bad market participants, and adopt an approach that is in line with Brazilian values and regulatory objectives.
🚨#Drex will ‘kill’ many #cryptocurrenciessays chairman of the CVM
‘I’m not talking about it #Bitcoin“but Drex will reduce the attractiveness of smaller cryptocurrencies” pic.twitter.com/Z6HYmUyFIh
— Livecoins (@livecoinsBR) November 11, 2023
“We cannot stop innovation”
The CVM president also spoke about the regulation of cryptocurrencies in Brazil, emphasizing the importance of regulating technological innovations in the financial market.
In his statements, he cited author Yuval Noah Harari, especially his book “Sapiens,” as an influence on his thinking.
According to him, the History shows that attempts to prevent the emergence of new technologies often fail. He argues that rather than resisting innovations, it is more productive to see opportunities in them and integrate them into the regulated market.
Nascimento emphasized that such an approach not only promotes technological progress, but also ensures that this progress takes place within a secure and structured regulatory framework.
The CVM Chairman also emphasized that adaptive and well-informed regulation can help maximize the benefits of these innovations, while minimizing potential associated risks.
🚨Chairman of the CVM for the regulation of #cryptocurrencies:
‘Every time people
They tried to stop innovations, but they failed.”“I understand that we have to see opportunities in new things and try to bring these new things to market” pic.twitter.com/o9ypReGuHf
— Livecoins (@livecoinsBR) November 11, 2023
“The entire crypto economy should not be condemned”
The CVM president also mentioned conversations with other global regulators, including Gary Gensler, president of the United States Securities and Exchange Commission (SEC), who is taking a more cautious stance on bitcoin.
While Gensler expresses skepticism about the value of the crypto economy, the CVM president defends a more comprehensive view, recognizing tokenization as a positive aspect, which improves various human relationships through a centralized and distributed ledger.
He argued that one should not condemn the entire crypto economy, but rather distinguish between good and bad participants.
The aim is to include in the regulated environment those participants who make a positive contribution to the growth of the capital market, preferring their inclusion in the regulated market rather than leaving them in the marginal market, where they can generate risks and cannot contribute to important aspects such as preventing money laundering and combating tax evasion.
Such an approach, according to Nascimento, is consistent with the positions of other Brazilian financial authorities, such as Financial Activity Control Council (COAF) Chairman Ricardo Leal and Executive Secretary Daril Durigan.
Finally, Nascimento championed a smaller, but more organized and regulated crypto economy, at the expense of a deregulated crypto economy that could endanger Brazil on several fronts.
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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.
