Brazil’s Rio de Janeiro aims to invest 1% in cryptocurrency; soon to launch Crypto Rio

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Brazil’s Rio de Janeiro is increasing its efforts to facilitate bitcoin adoption. Recently Rio mayor Eduardo Paes expressed his intention to create Crypto Rio and transform the city into a tech hub as well as allot 1% of its reserves in the digital asset industry. Paes in a decree published on 14th January 2022 announced the creation of a working group to explore opportunities in incentivizing the use of crypto and boost the city economy, such as offering discounts when paying taxes with Bitcoin. 

According to the decree, digital asset might also used to fund city projects. The working group is set to publish the results of its study in 90 days. Pedro Paulo, secretary of finance and planning of the city, at the event on Thursday said:

We are going to launch Crypto Rio and invest 1% of our public funds in cryptocurrency, We are studying the possibility of paying taxes with an additional discount if you pay with bitcoins. You take the discount off the single quota of 7% (of the IPTU), it becomes 10% if you pay in bitcoin. Let’s study the legal framework to do this.

If succeeded, Rio will become the first Brazilian city to hold bitcoin on its balance sheet. Last year, El Salvador became the first nation to buy bitcoin on its balance sheet. The central American country presently holds nearly 1,390 bitcoins, worth more than $58 million at current prices.

The recent developments reflects a positive stance of the brazilian administration towards the digital asset industry.

Brazil advancing towards legalizing Bitcoin

Previously a crypto bill that that allowed workers to accept Bitcoin as their salary was approved by the Chamber of Deputies of the Brazilian Congress in the early days of December 2021and is currently awaiting review by the Senate. Federal Deputy Luizão Goulart, a congressman, went on to propose a bill to legalise crypto payments as a mode of payment for public and private sector workers.

The project, known as Bill 2303/15 and proposed by Deputy Aureo Ribeiro, establishes definitions for exchanges and virtual currencies. It also requires a central body to monitor all cryptocurrency-based operations, which will be appointed by the executive branch of the government. 

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