#177: BC's Galipolo warns of under the table stablecoin usage at BIS event
Aaron Stanley
Builder | Creator | Catalyzer | Dot-Connector | Brazil | Web3 | Digital Assets
Plus: Eduardo Bolsonaro says "cryptocurrency is freedom"; another IPO to launch on BEE4
Olá pessoal!
Welcome back to ????Brazil Crypto Report for the week of February 3-7, 2025.
I hope everyone enjoyed watching the least competitive Super Bowl since 2014 last night. I don’t care for either team personally but was disappointed that the game wasn’t more interesting.
Anyways, on to more important matters
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Thanks for reading and have a great week!
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Last week we soft-launched a new podcast miniseries called "Bits & Borders” that will take us on a country-by-country tour of crypto adoption in Latin America (and perhaps beyond?) in 2025.
For the inaugural episode we showcase Guyana, which has long been an overlooked country but has been the fastest-growing economy in the world in recent years due to oil discoveries off its coastline.
To tell us all about it, I’m joined by Tony Edward , who is a Guyanese native and host of the popular Thinking Crypto Podcast (which I highly recommend)
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OriginalMy relocates to from Brazil to Estonia after pushback from CVM and notaries
Edilson Osorio Junior , founder of blockchain-based intellectual property platform OriginalMy, shared with Valor how he relocated his company from Brazil to Estonia after running into bureaucratic opposition in Brazil from the CVM (Brazil’s securities regulator) and the Brazilian Notary College.
OriginalMy provides legal proof of authenticity, digital signatures, digital certification and document registration on blockchain. These services were in direct competition with Brazil’s sprawling industry of notary offices, and Edilson claims that they sought to thwart his push to provide these notary-like services in a more user-friendly format.
“The Brazilian Notary College saw me as a competitor and they have a lot of lobbying power…They sent people from the legal field to my lectures to tell me that I couldn’t use terms like ‘authentication,’ for example, since only notary offices can perform this type of service in Brazil.”
The Brazilian Notary College denied the accusation, but Edilson claims that the organization rolled out its e-Notary tool as a way to hinder his project.
Today, OriginalMy operates in Estonia, where it has certified 1.2 million documents originating from 26,000 users — many from Brazil.
“Estonia was much faster and cheaper, and they already had blockchain regulations. I got my e-residency, Estonia's digital residency, and opened the company locally.”
Edilson said he also ran into problems with the CVM in 2018 when he was attempting to raise capital via a token sale
BC’s Galipolo: 90% of Brazil crypto volume is stablecoins
New Central Bank president Gabriel Muricca Galípolo spoke about the institution’s concerns about stablecoin usage in the country during a Bank for International Settlements event in Mexico City.
The bank has determined that 90% of Brazil’s crypto volumes are attributable to the growth of stablecoin usage in the country, namely USDT.
"We assumed that it was probably an easier way to have a dollar account.”
After further research, it became apparent that cross-border payments are the predominant use case for these assets. The optics this are not great, he argued, and there remains doubt as to the motivations of the entities behind these payments:
“The answer is that it is much more to use as a means of payment and most of it is to buy things abroad, cross-border payments, and usually things that people are buying, and that is the bad part, and they are using it because it maintains some kind of opaque vision for taxation or money laundering, things like that. This is not an accusation or anything like that.”
On the question of motivation, he suggested that there are many people using stablecoins because they don’t wan’t to declare their transactions to the government for taxation purposes. This in turn creates supervision and regulation challenges for the Central Bank.
“It is a challenge for supervision and regulation because there is a clear division between fiscal and financial privacy. This exchange of information between the Federal Revenue Service and the BC is not easy because we have to respect privacy rules”
Galipolo: Drex is a DLT network, not a CBDC
The bank president also told the audience that the Drex project should be thought of as a distributed ledger technology network and not a CBDC:
“[Drex] is not a central bank digital currency [CBDC], it is a distributed ledger network with tokenization of deposits and assets with a smart contract structure, that is the idea behind Drex”.
He also discussed how the bank plans to frame Drex and its benefits to the public, namely how it can improve people’s finances by unlocking collateralized assets:
“When we try to explain to people what kind of problems Drex can solve in their lives, the example we usually use is that you can have collateralized finances and credit using this infrastructure.”
You can watch Galipolo’s remarks (in English) at the link below, starting around 2:08 mark.
BEE4 announces 5th IPO via its blockchain platform
The blockchain-based secondary marketplace for small and medium sized companies announced that Roda Conveniência will raise as much as R$8 million through its platform via an IPO.
The raise is the fifth IPO that BEE4 has supported since launching, and the first in 2025.
Operating within the CVM regulatory sandbox, BEE4 provides a tokenized trading environment for companies with annual revenues between R$10 million and R$300 million.
Roda Conveniencia is a leader in autonomous minimarkets in the state of Rio de Janeiro, operating in condominiums, co-working spaces and companies. Patricia Stille , co-founder of BEE4, said:
“Roda Conveniência is a unique company that has been growing rapidly, demonstrating the potential of Brazilian SMEs that have excellent managers on the front line. In a context where more and more people are seeking practicality in their lives, Roda has been expanding the use of technology and data intelligence to maximize sales at its stores in residential condominiums and guide business decision-making"
Valor runs petty post by anti-bitcoin columnist
Valor columnist Marcelo d’Agosto posted a bizarre anti-bitcoin article arguing that the cryptocurrency has no practical use because it hasn’t gained traction as an alternative currency.
He then argues that the store of value thesis is wrong because there is a fixed supply of bitcoin and that the price is dependent on stimulating new sources of demand, such as new ETFs or a strategic bitcoin reserve in the US.
He didn’t go as far as to say that bitcoin doesn’t have any value because it “isn’t backed by anything”, but says you shouldn’t buy bitcoin because the price is volatile.
Fabrício Tota of MB | Mercado Bitcoin had a nice rebuttal to the column in Portal do Bitcoin
??Brazil Crypto News Rundown
?? Markets
"This is a particularly important moment for holders of the Vila Token, who recently received a payment of R$7.1 million, corresponding to the second installment of Neymar's transfer to Al Hilal. The amount resulted in a transfer of R$11.58 per token, which was launched at R$50. In total, the Vila Token has already distributed more than R$19 million to investors in ten transfers made since its launch." (CoinTelegraph Brasil)
"We are always looking for ways to provide more value to our customers, and Compra Turbinada is a perfect example of this. With this feature, we are democratizing access to capital through loans, which were previously exclusive to large investors.” (CoinTelegraph Brasil) (E-Investidor) (Livecoins)
?? Adoption
“The country can once again specialize in open source applied to artificial intelligence. We can create an artificial intelligence law with the ambition of protecting and promoting open models, transforming the country into a hub for the development of AI of this nature.”
?? Policy, Regulation and Enforcement
Diretor de Novos Negócios no MB | New Business Development SVP at MB
3 周Happy to be at the newsletter again! :-)
Link to full version on Substack https://newsletter.brazilcrypto.io/p/177-bcs-galipolo-warns-of-under-the