Real Digital was the name chosen by the Central Bank of Brazil for its new digital currency, which will serve as Brazil’s CBDC (Central Bank Digital Currency).
It is worth noting that CBDC (Central Bank Digital Currency) consists of a digital currency model issued by a central bank with a view to incorporating benefits and features already provided with private digital currencies, called cryptocurrencies, which use blockchain technology, such as payment cryptocurrencies and tokens.
In May 2023, the registration period for partaking the pilot project of this digital currency started. According to BACEN, in this testing phase, up to ten financial institutions will be able to participate as long as they are able to test, based on their respective business models, the redemption, issuance and transfer transactions of financial assets, not to mention the financial flows resulting from trading such assets.
In fact, some financial institutions have already submitted proposals, such as the use of Real Digital for buying and selling products and contracting financing, in which the buyer’s digital currency and the seller’s car or property token are transferred between digital wallets within a bank’s application.
Even before this pilot stage is completed, it is certain that, because it is an innovation with a substantial potential of reliance in routine operations for individuals and companies, we can expect significant impacts on the Brazilian financial system.
Expectations are that this currency version will allow faster and more efficient transactions, since transfers could be made in real time and without intermediaries, which has already been seen and validated as useful, similarly, in PIX use.
In addition, the digital currency could even assist in fighting money laundering and tax evasion, since currency transactions would be easily tracked, recorded, and monitored by BACEN, thus making it the safest and most reliable financial system for consumers, entrepreneurs and investors alike.
Similarly to any other significant change in the country’s financial system, the new currency will undoubtedly also trigger impacts on the Brazilian legal system.
Real Digital is expected to facilitate international transactions, leading to an increase in the demand for legal settlement of cross-border conflicts. As a result, this would require the court system to develop new ways to deal with these cases, such as the use of international arbitration and international judicial cooperation chambers.
In addition, by reducing physical cash transactions, it would facilitate the tracking of illegal activities such as financing drug and arms trafficking, terrorist acts, and money laundering. This would imply wide-reaching mechanisms for investigating and combating organized crime.
Even the use of currency can lead to clearer and more accurate records of digital transactions, which also tends to help solve financial and tax disputes, enhancing and supplying such cases with data.
It is certain that Real Digital can have significant impacts on the lives of Brazilians, thus requiring the development and application of new financial and legal solutions by private and public institutions to deal with new paths that tend to arise.
Available at: https://exame.com/future-of-money/real-digital-os-possiveis-reflexos-no-sistema-financeiro-e-judiciario-nacional/
Autor: Lucas Rodrigues Lucas • email: lucas.lucas@ernestoborges.com.br
