Brazilians have purchased more than $4 billion in cryptocurrencies, data of the Central Bank of Brazil show. They have acquired more than $350 million dollars of cryptocurrencies each month since January.
The acquisition trend reached a peak in May. Purchases of $756 million were made during that month alone, Bitcoin.com reports. Numbers have declined since then, dropping to $500 million in August.
Interest in crypto unlikely to fade
Crypto entices Brazilians. This interest is unlikely to wane in the future according to Bruno Serra, the director of monetary policy of the Central Bank of Brazil. Some bank officials believe the number can double by the end of the year.
According to Serra, cryptocurrency investments made by Brazilians abroad could lead to a threefold increase of the amount invested in American shares. The process is somewhat hindered by the fact that the South American country doesn’t produce cryptocurrencies at the moment. Serra said:
It’s a one-way flow. Due to the cost of energy, Brazil does not produce crypto assets; it is just an importer. There is potential for this inflow number to reach more than $8 billion this year.
According to the Central Bank’s report, cryptocurrency outflows are around $15 million, which is less than one percent of inflows.
What’s behind the numbers?
The Central Bank of Brazil registers cryptocurrency inflows and outflows in statistics. The bank uses exchange contracts as the basis to estimate these numbers. Exchange contracts are legal instruments that record negotiations between sellers and buyers of Bitcoin and other cryptos.
However, the actual numbers could be higher than those reported because these instruments only record cryptocurrency exchanges between residents and non-residents of Brazil.
Anonymity ‘not an option’
Mauricio Moura, a director of the Central Bank of Brazil, has said anonymity wouldn’t be an option for those transacting in cryptocurrency. He stated that the government would begin to identify all user transactions sooner or later at an event on prevention of money laundering and terrorism financing, which Bitcoin.com wrote about in September 2021.
Moura stated that new legislation was being drafted. If passed, it will prohibit anonymity in cryptocurrency transactions made in Brazil. He was quite succinct in his statement:
The names of those involved in cryptocurrency operations will be known end-to-end. I can say that anonymity will not be an option.
