Brazil's Congress is considering a groundbreaking bill to establish a Sovereign Strategic Bitcoin Reserve (RESBit), aiming to position the country as a leader in the global digital economy. Introduced on November 25 by Federal Deputy Eros Biondini, the proposal outlines a plan for Brazil to allocate up to 5% of its international reserves to Bitcoin. This reserve would complement the country's existing foreign assets, which total $355 billion, and serve as a hedge against economic risks and currency volatility.

The legislation identifies Bitcoin as a tool for financial diversification and technological advancement. RESBit would be managed by Brazil’s Central Bank and the Ministry of Finance, with support from a technical advisory committee of "blockchain and cybersecurity experts." The reserve would also back Brazil's forthcoming central bank digital currency (CBDC), Drex.

“The formation of RESBit is a strategic measure that positions Brazil at the forefront of the new digital economy, reducing economic risks and expanding opportunities for technological and financial development,” Biondini stated in the bill.

The reserve would be gradually acquired through a controlled process, with assets stored in cold wallets. Management would adhere to Brazil’s Fiscal Responsibility Law, with semiannual reports submitted to the National Congress for accountability. The bill also includes provisions for penalties in cases of "noncompliance" or "mismanagement of the reserve."

The bill cites El Salvador’s adoption of Bitcoin as legal tender in 2021 as a model of economic diversification. El Salvador currently holds nearly 6,000 BTC, valued at approximately $542 million as of November 26, and has used Bitcoin to enhance financial inclusion and attract foreign investment. According to the proposed legislation, Bitcoin’s performance in El Salvador highlights its potential to mitigate global economic risks.

The bill is currently under review by the Speaker of Brazil’s House of Representatives and will be directed to relevant committees for debate upon approval. If enacted, Brazil would join a growing list of countries integrating Bitcoin into their financial systems, potentially setting a precedent for other nations to follow.

The introduction of RESBit marks a significant step in Brazil’s approach to digital assets, reflecting the growing acceptance of Bitcoin as a legitimate asset. Proponents argue that the reserve could protect Brazil from global economic uncertainties while fostering innovation in the digital economy.

Cointelegraph Article