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Rio de Janeiro Will Allocate 1% Of Treasury To Bitcoin

Talks about Bitcoin in Brazil are commonplace, but concrete political action has now been taken to adopt it. Eduardo Paes – mayor of Brazilian city Rio de Janeiro – recently announced plans to invest 1% of the city’s treasury in Bitcoin. His city will join a list of other political jurisdictions making small allocations to the cryptocurrency, eyeing its long-term potential. 

Rio Hops On Bitcoin

Paes announced the city’s new plans in a presentation at Rio Innovation week in conversation with Miami Mayor Francis Suarez. The latter is already known for his Bitcoin fanaticism and is taking his salary in cryptocurrency. 

“We are going to launch Crypto Rio and invest 1% of the Treasury in bitcoin,” Paes said.

Rio mayor: How to build the city of the future | CNN
Eduardo Paes. Source: CNN

“Crypto Rio” is the mayor’s idea of Rio de Janeiro as a cryptocurrency hub. Suarez is currently trying to establish Miami as the same and competes with NYC’s mayor. However, despite his efforts, he hasn’t allocated any of the city’s reserves to Bitcoin.

Paes claims that Rio de Janeiro can become the tech capital of South America, as Miami is becoming in North America. He’d like to strengthen the city’s image as a place to “work, live, and innovate”.

Brazillian regulators have been strictly regulating the crypto industry at the federal level. In October, the country introduced guidelines on crypto-related financial crime. Two months prior, it conducted the most significant digital asset seizure in the nation’s history.

However, Brazilians are already pretty excited about Bitcoin at the individual level. A poll from September found that 48% of Brazilians would support making Bitcoin legal tender. Furthermore, respondents cited “protection from inflation and financial instability” as their primary reason for adopting it. Notably, while over 90% showed awareness of Bitcoin’s existence, only 31% were familiar with Ethereum.

The last time a Brazilian politician vouched for Bitcoin this firmly was in November. Then, deputy Luizão Goulart proposed a bill to allow public sector workers to be paid in Bitcoin.

The Meaning of 1%

1% allocation sounds small, but it indicates the city’s acceptance of Bitcoin as a legitimate asset. Numerous investors and regions are now experimenting with small Bitcoin allocations in preparation for its potential long-term growth. 

Paul Tudor Jones – a billionaire hedge fund manager – has admitted to having a single-digit percentage of his portfolio in Bitcoin. Meanwhile, after starting with a 1% allocation in 2014, Bill Miller has now made the asset 50% of his holdings.

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El Salvador is now notorious for being the first nation-state to stack Bitcoin. It currently HODLs over 1000 BTC.

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