- Brazilian Congressman proposes creating a Bitcoin reserve.
- The plan aims to allocate 5% of Brazil’s international reserves to Bitcoin.
- Inspired by Bhutan’s successful Bitcoin strategy for diversification and inflation protection.
A Brazilian Congressman recently proposed a major development plan for Brazil regarding digital assets. On November 26, Eros Biondini from the country’s Liberal Party proposed a new law that would induce Brazil to create a strategic Bitcoin reserve.
Now more than ever, nations worldwide are starting to adopt Bitcoin as a value reserve. While the volatility of a cryptocurrency asset would generally be deemed too risky for a country to adopt it in its reserve — the growing popularity and valorization of Bitcoin have made it a worthwhile investment.
This initiative was kickstarted by El Salvador, who started buying 1 BTC per day for over 3 years. Today, this dollar-cost average strategy has already paid off over $100 million in profits.
In fact, according to the Congress proposal filing document, Congressman Eros Biondine could have been inspired by El Salvador’s President Nayib Bukele.
The proposal would oblige the Brazilian government to maintain a gradual crypto acquisition until it reached 5% of Brazil’s international reserves. Biondini states that the proposal — named Sovereign Bitcoin Strategy (RESBit) — aims to diversify the country’s financial assets under the National Treasury, revamp the use of blockchain in the public sector, pump the issuance of the Brazilian Real, and — most importantly — aid the Brazilian reserves against sudden inflation spikes.
Brazilian Congress will still decide if Biondini’s proposal will move forward. However, given the rapid pace at which Brazilians have been adopting Digital Asset, the Brazilian Sovereign Bitcoin Strategy has everything to gain popularity with the general public.
As for the crypto market, the head-on Bitcoin adoption strategy from one of the world’s largest economies would certainly have a positive effect on the state of crypto.
