Brazil’s crypto regulatory environment is pushing competition – Coinext CEO
The cryptocurrency may be “out of fashion,” but it still attracts new users to Web3 every day — especially in emerging markets like Brazil — according to bitcoin expert José Ribeiro, CEO of crypto exchange Coinext.
During a webinar in Lisbon, Ribeiro spoke with Cointelegraph's Joe Hall about Bitcoin (BTC), his outlook on Brazil's vibrant crypto economy, and how regulatory transparency has boosted competition in the country's payments sector.
According to Ribeiro, the volume of bitcoin transactions in Brazil will reach record levels in 2023 as more international crypto exchanges such as Binance, OKX and Coinbase set up operations.
“Competition has increased significantly, which is part of the business from a crypto adoption perspective. The country has a history of inflation, and I see interest rates going down for sure next year, and we're going to have another cycle,” Ribeiro said.
The benchmark interest rate in Brazil is currently 12.25%, down from 12.75%, and could reach 9.25% by December 2024, according to a survey by the local central bank.
Along with low interest rates in Brazil, international drivers such as spot Bitcoin exchange-traded funds in the United States and the halving of Bitcoin are expected to impact prices. However, the crypto community should focus on fundamentals rather than price movements, says Ribeiro.
“People hear about Bitcoin when its price always peaks, right? […] But people don't talk about fundamentals much, and fundamentals haven't changed since their inception.
In addition, Ribeiro emphasized the importance of regulatory frameworks to promote innovation in the country. “We are very advanced in terms of forms to agree with the tax authorities,” said Ribeiro, referring to the monthly reports submitted to the local tax authorities on the exchange.
According to Coinext CEO, Brazilian regulators are open to discussions about crypto and payments:
“they [Brazil’s regulators] Understand about crypto, understand about the risks of our business, this is good. I don't say regulation is good, but regulation is needed in some way because we definitely need some regulation to be competitive in the market because we are competing with companies outside of Brazil, so we are not competing equally. way”
In the past few years, Brazil's central bank has implemented the Pix payment system, which allows fast payments between individuals and businesses. For Pix transactions, users only need a Pix recipient's key identifier, such as an ID number, mobile phone number or email address.
The country is developing a central bank digital currency called DREX, which is expected to be launched next year. “This puts Brazil at another level in terms of blockchain adoption, in terms of using blockchain for the entire infrastructure of the financial market industry,” Ribeiro explained.
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