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Rio works on cryptocurrency investment methodology, reveals Finance Secretary

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The city of Rio de Janeiro continues to work to make the city a hub of crypto assets.

After Mayor Eduardo Paes to reveal that Rio citizens will be able to use cryptocurrencies such as Bitcoin (BTC) to pay the IPTU from 2023, the Secretary of Finance and Planning, Andrea Senko, reported that the municipality is developing a methodology for investing in cryptocurrencies.

For this, a Municipal Committee for Cryptoinvestments is being created. It will be up to the committee to improve this methodology, which will be developed based on the analysis of risk versus profitability as well as on the rules and limitations of the use of public money.

In addition, the secretary said that Rio is working on a governance model focused on directing decisions on the application of the municipal treasury.

Senko did not say that the City will keep part of the Treasury in crypto. However, Paes said in January, that the city would invest 1% of its treasury in BTC (BTC).

Rio de Janeiro: crypto city

As the secretary pointed out to the newspaper O Estado de S. Paulo, the final objective of the initiatives is to make Rio a national hub in the digital assets market. At the same time, the city wants to encourage the circulation of these assets. To this end, Rio seeks inspiration in other cities that have launched similar initiatives:

“Rio City Hall seeks to create the ideal ecosystem for the development of a solid cryptocurrency market in the city. There are successful cases in the world that followed the same line and served as a benchmark for the municipality, such as the states of Ohio (USA) and Ontario (Canada)”, he adds.

As mentioned, firstly, the city will allow the IPTU to be paid with cryptocurrencies, being the first Brazilian city to do so.

In addition to BTC, it will be possible to use other digital currencies to pay the tribute. However, this will vary according to the brokers enabled to convert the value.

Senko explained that City Hall will receive the amounts in reais and not in crypto. The idea is that there is no legal impediment to offering this alternative to taxpayers. After all, the national cryptocurrency market is still not fully regulated.

Rio seeks brokers for IPTU payment in crypto

At the moment, the city is preparing a public notice to accredit companies that will convert cryptocurrencies into real and, later, will transfer them to the municipality.

This accreditation will require registration in Brazil and partnership with a bank accredited to the Brazilian Federation of Banks (Febraban)

According to Senko, the new payment method should already be tested in the second half of this year so that in 2023 operations will be available. But the secretary pondered that, at first, the expectation is not of very high adhesion at the beginning.

Focus also on NFTs

In any case, the municipal administration already plans to expand the initiative to other municipal taxes. In addition, Rio wants to encourage the development of the crypto market through Treasury applications.

In the future, the city hopes that cryptocurrencies will be used for day-to-day payments, such as taxi rides, for example.

The heated market for non-fungible tokens (NFTs) is also in the city’s plans. According reported by CriptoFácil, City Hall wants the technology of NFTs to boost the art, culture and tourism markets.

In this sense, the City Hall will hold a public hearing to receive and present suggestions for developments with NFTs.

The creation of City Hall NFTs with images of tourist spots has already been suggested. Still, spaces can be created for artists to make interventions that would later become NFT.

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