Soon You Can Pay Your Real Estate Taxes with Crypto in Rio

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While Bitcoin as legal tender seems to be a bit farther away than some would hope, Brazil's second largest city recently announced that, beginning in 2023, real estate tax payments will be accepted in cryptocurrencies, primarily for tax on property and urban territory. Mayor Eduardo Paes said, "“Our effort here is to make sure that Rio has official initiatives that recognize the crypto market. Who invests in crypto and lives in Rio will be able to use crypto to pay taxes in the city of Rio. We will advance on this project quickly”.

On March 26th, Binance CEO Changpeng Zhao tweeted "9 days ago, I made a handshake deal with mayor @eduardopaes. Rio De Janeiro will accept crypto for tax payments, and @Binance will open an office in Rio. He's done his part. We are working on ours."

Coming on the heels of the aforementioned Binance expansion are rumors that have Coinbase looking to potentially acquire 2TM. They are the largest crypto firm in Brazil which runs the Mercado Bitcoin exchange, having close to 3 million users at the time of writing. Last year the exchange became the eighth most valuable unicorn in Latin America, and Brazil's first crypto unicorn.

The Country of Brazil is certainly no stranger to the world of cryptocurrency. In January of 2021, the Brazil Securities and Exchange Commission (CVM) approved a Bitcoin. That ETF began trading (ticker QBTC11) on the Brazil stock exchange in June of 2021.  Brazil follows Canada as the second Country in the Americas to do so.

Mayor Paes announced efforts to create "Crypto Rio" at Rio Innovation Week conference, hoping to turn the city into a tech hub, much like Miami has become. To give firsthand insight, the conference also featured Miami Mayor Suarez. "We are going to launch Crypto Rio and invest 1% of our public funds in cryptocurrency," Paes later told the crowd.

Secretary of finance and planning, Pedro Paulo says RIO has plans to integrate NFT-based governance policies across various industries such as art and tourism. “Going forward, we will use crypto-assets to stimulate the arts, culture, and tourism through the use of NFTs, and create a solid and responsible governing policy to evaluate the realization of crypto investments," he said.

The Federal Senate will vote on "Bitcoin Law", which has three main objectives according to Senator Flavio Arns, the first is to “give security to the virtual assets market;” the second is “to protect the economic-financial order;” and the third is “to protect the Brazilian investor.” If the bill is approved, it will go to the Chamber of Deputies lastly to President Jair Bolsonaro, to give the bill its final approval.

Source: Gemini

Looking at some other key data from the Country:

  • Indonesia and Brazil show the highest amount of crypto held by Country, according to a recent Gemini report.
  • Homeowners in Brazil have been open to accepting cryptocurrency in selling their houses for years now.
  • The Central Bank of Brazil released a 2021 report that shows Brazilians had purchased more than $4 billion in crypto since the start of the year.

It's safe to say that Brazil is going all in on crypto and we are just seeing the beginning of what's to come.

*5/3/2022 update: according to Bloomberg, Coinbase is no longer in talks to acquire Mercado.

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