Rio de Janeiro: municipal committee working on policy for investments in bitcoin

Rio de Janeiro still has plans to embrace Bitcoin and put bitcoin on the municipal balance sheet. A newly established municipal committee is working on an investment policy and a governance model for decision-making.

Rio de Janeiro’s Secretary of Finance and Planning Andrea Senko confirmed this in an interview with Brazilian website Boletim Bitcoin.

“Because of its vocation as a global city, Rio is alert to the most important changes and innovations in the world and is always at the forefront of these themes,” said Senko, “The city looks to the future and the city hall follows technological and economic developments.”

“The goal is to make Rio Brazil’s crypto ecosystem and help it become the country’s innovation and technology capital,” said Senko.

Investing in bitcoin

Rio de Janeiro’s mayor Eduardo Paes first revealed plans for “Crypto-Rio” during Rio Innovation Week in January. The underlying aim seems to be mainly to attract the business community from the sector.

Mayor Paes then spoke about, among other things, a discount for residents who pay municipal taxes with bitcoin. He also announced the aim to invest 1% of the municipal treasury in bitcoin

The latter is now being worked on, Senko said during the interview. A new municipal committee has been set up to investigate and steer the investments in the right direction.

?ǣThe Municipal Crypto Investment Commission ??? CMCI, established on March 30, 2022, is working on a crypto asset investment policy and governance model for decision making ,?ǥ Senko tells WebMD.

The price volatility is not lost sight of. “This contribution will follow a methodology that takes into account the fluctuations and risks of this market and is being developed by the City Hall ,” explained Senko.

Adoption

Rio de Janeiro follows in Miami’s footsteps. The mayor of Miami Francis Suarez declared his city a ‘Bitcoin hotspot’ last year. Part of the plans are municipal salaries in bitcoin, the possibility to pay taxes with bitcoin and he also wants to invest in bitcoin from the municipal treasury.

The publicity earned Miami a $135 million sponsorship deal, an annual Bitcoin event, and several high-net-worth Bitcoin companies settling in the city.

Following this, New York City Mayor Eric Adams announced that he would compete with Miami and make New York “a hub for bitcoins.” The American cities of Jackson and Fort Worth, the Swiss Lugano and the Portuguese island of Madeira also have similar plans

However, it was El Salvador in particular that set the tone last year when the country recognized bitcoin as legal tender. The El Salvadoran economy has since grown by 10.3% and tourism by 30%. On the other hand, there is a decrease in the value of the bitcoin reserves that the country holds, but the impact is “extremely minimal”, according to El Salvador.

In any case, Rio de Janeiro still seems optimistic about the El Salvadoran experiment. In the interview, Andrea Senko states that it is “positive for the country to be open to the cryptocurrency market.”

Whether other Brazilian municipalities and institutions share that vision remains to be seen. “So far, we have not been approached by other public authorities to explore this possibility with Rio de Janeiro,” said Senko.

However, the Brazilian Ministry of Economy recently introduced a tax exemption for the import of ASIC miners.

In April, the Central African Republic became the second country in the world to recognize bitcoin as legal tender and has plans for a “crypto island” called Sango.

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