Brazil is prioritizing blockchain technology to enhance cross-border trade during its BRICS presidency, stepping away from earlier discussions about a common currency. The approach aims to improve transaction efficiency rather than compete with the US dollar. Additionally, the potential role of stablecoins in international settlements is being considered but lacks formal endorsement.
Brazil’s presidency of BRICS, encompassing major economies such as Russia, India, and China, is strategically focusing on blockchain technology to enhance cross-border trade. This decision departs from previous discussions about establishing a common currency among BRICS nations. According to reports from Valor Econômico, the priority is on streamlining trade transactions rather than creating a currency that challenges the US dollar’s dominance in foreign exchange markets.
The intention behind Brazil’s strategy is to improve the efficiency of international financial transactions rather than to instigate competitive economic currency dynamics. The Brazilian central bank is already testing a project called Drex, designed to foster a tokenized financial transaction infrastructure. However, this initiative faces hurdles regarding the balance between privacy and regulatory compliance.
The potential adoption of stablecoins also remains a viable alternative within BRICS. Russian Deputy Minister of Foreign Affairs, Sergey Ryabkov, indicated that stablecoins could facilitate international settlements among member states. Meanwhile, reports have confirmed that Russian oil companies are utilizing various cryptocurrencies to navigate financial transactions involving Chinese and Indian currencies, though no formal decision regarding stablecoins has yet been established within BRICS.
In conclusion, Brazil’s BRICS presidency is steering towards blockchain technology to optimize international trade operations while moving away from prior notions of a joint currency. The focus on enhancing transactional efficiency could reshape trade dynamics among member nations, positioning blockchain as a central element of future economic interactions in the bloc. The idea of integrating stablecoins is also being explored but remains unadopted officially.
Original Source: crypto.news
