In 2024, the Brazilian cryptocurrency market is expected to see a consolidation movement as the investor base expands.
Brazil’s cryptocurrency legal framework was approved in December 2022
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Brazil will experience a major evolution in the crypto market in 2023, with a scope that will extend beyond trading cryptocurrencies. As the number of users grew, the adoption of cryptocurrencies increased significantly, reaching 4.1 million. In addition, according to the Federal Tax Service, the number of women in the industry increased significantly in the first half of this year.
Combined with the growing trend of cryptocurrency adoption, blockchain technology has become the main solution for Brazil’s digital economy and is being used in important projects such as CBDC Brazilian, Drex.
Between January and July 2023 alone, the number of crypto investors in Brazil increased by 186%. Within seven months, the number of users jumped from 1.44 million to 4.1 million. This growth occurred during a bear market and a period of price recovery for major cryptocurrencies.
In 2024, the Brazilian cryptocurrency market is expected to see consolidation as the investor base expands, in addition, cryptocurrency trading volumes are expected to increase, such as BTC, as the halving approaches.
Halving and Crypto Adoption in Brazil
Every four years, the cryptocurrency market experiences an important change in price and trading volume, which is catalyzed by the “halving” event. In 2024, the BTC halving is expected to take place in April, and its halving may be the reason for the recent crypto brief recovery, BTC reaching $40,000 for the first time in 2023.
In addition to influencing the prices of major cryptocurrencies, the halving could also spur an increase in cryptocurrency adoption in Brazil, following previous growth trends, such as those observed in 2020, the last halving.
That year, the number of users in Brazil grew by 100%, starting in January with about 103,000 investors and by December, the number of investors was close to 205,000. If the same growth occurs again in 2024, the number of investors in the Brazilian crypto market could exceed 8 million.
If we look at the growth of the Brazilian cryptocurrency market in 2023, this figure may be even more significant. From January to July of this year, the user base grew by 186%, and maintaining this growth rate will lead to 11 million users by 2024.
Blockchain Technology
Blockchain is a solution that can be used for projects outside of the crypto market. This disruptive decentralized data management system will be the basis for the development of the CBDC pilot project in Brazil.
In 2024, Drex will launch a pilot version during the beta phase. First of all, the Brazilian CBDC will be developed from the Hyperledger created by the blockchain technology Besu.
Therefore, blockchain will play a leading role in the creation of the first Drex model. Next year, the Brazilian CBDC may be tested in digital currency transactions through the Pix, which will lead to the integration between the instant payment system and the technology that “brings life” to the BTC.
In addition to using it to create a digital, decentralized financial ecosystem for the development of Drex, Brazil will explore another benefit of blockchain technology in 2024, in an area that requires data verification and information authenticity: the creation of digital documents.
With the proposal to unify documents into digital versions, blockchain technology is being applied in data management systems to develop digital IDs.
Last but not least, I must emphasize that the Brazilian securities regulator is also planning a tokenization pilot in 2024, which will affect several financial sectors in the country, which may involve sectors such as real estate, bonds, securities, forestry resources, etc. Strategic importance.
The use of the technology through Drex in the digitalization process of the Brazilian economy, the issuance of digital documents, and the tokenization of assets highlights the consolidation of blockchain adoption in Brazil in 2024.
Women’s Market
The increase in cryptocurrency adoption is also due to the popularity of cryptocurrency use in the country. In terms of gender, we have observed an important change in the emergence of female investors in the Brazilian cryptocurrency market.
In January 2023, the share of female investors in the cryptocurrency market reached around 25%, that is, a quarter of Brazilian investors are women.
Although this number declined in the following months, from May to July, the number of women rebounded, growing by almost 50% in just three months. However, in terms of trading volume, the presence of women continues to expand, with data from the Federal Tax Service showing that they currently make up 16.26% of investors. Despite a slight decrease in the number of women in the first half of the year, in May 2023, female crypto investors broke records, with a crypto trading participation rate of 18.08% in 2023.
In 2024, the influence of women in the Brazilian crypto market should continue to expand as cryptocurrency transactions such as BTC increase and the halving approaches. In addition, initiatives such as the U.S. approval of BTC spot ETFs could impact the increase in crypto adoption globally, including in Brazil, by 2024.
