BREAKING: BRICS Leaders Expected to Launch Digital Fiat at Summit
Experts in Brazil believe that leaders of the BRICS nations will agree to launch a digital fiat currency for the bloc at an upcoming summit. The coin could potentially debut within the next five to 10 years. The head of foreign exchange at Trace Finance, Evandro Caciano, suggests that the nations should establish working groups during the summit to tackle the subject, while analyst Milena Araújo expects discussions to initiate a feasibility plan for the proposal. Caciano suggests that a single digital currency for BRICS is possible if the BRICS bank issues it and becomes its regulator. The issuance process could be implemented gradually over the course of five to 10 years.
Why Are Member States Keen on a BRICS Digital Coin?
The current global economic climate, coupled with the United States’ economic crisis, makes the creation of a BRICS coin favorable. Brazilian President Luiz Inacio Lula da Silva supports the idea of a common currency to facilitate trade between BRICS countries, potentially replacing the US dollar in trade deals.
Will Progress Be Made This Month?
BRICS nations have been discussing the launch of a digital token since 2019. China, Brazil, and Russia have made significant progress with their own CBDCs, and all three countries have mentioned the possibility of conducting cross-border trade using their digital currencies. Russia and potential BRICS member Iran have also discussed co-launching a gold-pegged stablecoin.
Could BRICS Really Launch a Digital Currency?
Lord Jim O’Neill, the economist who coined the term BRICS, finds the idea of a common currency for the bloc “ridiculous” and questions how a BRICS central bank would be created. While South African officials deny that a common currency is on the agenda for the summit, the issue has been debated at previous summits. In addition to discussing a digital currency, BRICS leaders will also consider membership applications from other countries.
Hot Take: The Potential Impact of a BRICS Digital Fiat
If the BRICS nations successfully launch a digital fiat currency, it could have significant implications for the global financial landscape. By reducing reliance on the US dollar and establishing a shared digital currency, BRICS countries could boost trade and economic cooperation within the bloc. However, challenges such as regulatory coordination and technological implementation will need to be carefully addressed. The next five to 10 years will be crucial in determining the future of a BRICS digital coin and its potential impact on the international monetary system.
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