Latam Insights: Brazil Advocates National Currencies in BRICS…

This week’s Latam Insights covers Brazil’s initiative to encourage BRICS nations to utilize national currencies over the U.S. dollar, the decline of bitcoin adoption in El Salvador despite government support, and the legal breakthrough for smart contracts in Argentina that validates a Cardano-based contract.

In the latest edition of Latam Insights, we explore crucial developments in Latin America’s economic landscape, notably Brazil’s strategic shift within BRICS towards the use of national currencies in global trade, the stagnation of bitcoin adoption in El Salvador, and a significant advancement in legal recognition of smart contracts in Argentina. Brazil is making a concerted effort to lessen the BRICS group’s reliance on the U.S. dollar by promoting increased adoption of member states’ national currencies in international trade. Eduardo Paes Saboia, Brazil’s Foreign Affairs Secretary for Asia and the Pacific, revealed that such discussions have already taken place among finance ministers and central bank heads within BRICS countries. Saboia expressed anticipation that these discussions would manifest in official declarations at the forthcoming BRICS summit in Kazan. In contrast, bitcoin adoption in El Salvador is facing considerable challenges. A recent survey revealed that only 7.5% of respondents had utilized bitcoin for transactions, marking a decline from 12% recorded the previous year. Analysts have raised concerns about this stagnation given the financial investments made by the government, which has actively supported bitcoin as legal tender since 2021, even incentivizing usage through a $30 airdrop to citizens registering with the government’s bitcoin wallet, Chivo. Meanwhile, Argentina has made strides in legalizing smart contracts, with the country’s jurisdiction granting legislative recognition to a Cardano-based smart contract. This contract, formalizing a loan agreement between Mauro Andreoli and Lucas Macchia, can now be legally enforced, which signifies a potential precedent in Argentina and possibly worldwide. Despite this digital innovation, the two parties needed to complement the smart contract with a traditional legal document due to its digital nature. These developments underscore the evolving state of cryptocurrency and economic reforms across Latin America, reflecting both challenges and advancements in the region.

Recent dynamics within BRICS highlight Brazil’s proactive approach to diminish the group’s dependency on the U.S. dollar, signifying a shift towards national currencies in global trade. This effort is set against a backdrop of increasing geopolitical tensions and economic strategizing among rising economies. Meanwhile, El Salvador’s experiment with bitcoin as legal tender serves as a case study for cryptocurrency adoption, marred by a decline in usage despite significant state efforts. Argentina’s acknowledgment of smart contracts illustrates the growing acceptance of blockchain technology in formal legal frameworks, indicating a move towards innovative financial solutions.

In conclusion, the economic landscape in Latin America is marked by both progressive initiatives and hurdles. Brazil’s focus on reducing dollar dependency within BRICS highlights a shift in economic alliances, while El Salvador’s struggles with bitcoin adoption reveal the complexities of integrating cryptocurrency into everyday use. Furthermore, Argentina’s legal recognition of smart contracts marks a significant development in the adoption of blockchain technology, paving the way for future innovations in financial transactions.

Original Source: news.bitcoin.com