Chapter 9 of 12 · What is money?
Crypto-assets, stablecoins and CBDCs
Educational text. This content explains concepts and history; it is not an individual investment recommendation or a promise of returns. Figures, rates and regulatory status have a reference date of and change over time. The bracketed references — [1], [2]… — are listed in the Sources section.
Warning: crypto-assets can suffer large price swings and total losses. Nothing in this section is a recommendation to buy.
Bitcoin: the internet's native money
On October 31, 2008, someone using the pseudonym Satoshi Nakamoto published the paper describing Bitcoin, and on January 3, 2009, the first block was mined [25]. Bitcoin was the first form of digital and decentralized money to work at scale, without a government or company issuing it.
A cryptocurrency uses a blockchain — a distributed ledger that is very hard to alter retroactively — and cryptography to validate transactions without intermediaries. In Brazil, companies that provide virtual-asset services are regulated by Law 14.478/2022 [37].
Bitcoin compared with traditional money
| Feature | Fiat money (real, dollar) | Bitcoin |
|---|---|---|
| Issuer | Central bank | Protocol rules, enforced by a decentralized network |
| What sustains its value | Trust in the issuer and legal tender status | Trust in the network and in scarcity; there is no backing. Proof of work protects the ledger, but it is not backing |
| Supply | Set by monetary policy | Capped at about 21 million units by the code [25] |
| Divisibility | 2 decimal places (cents) | 8 decimal places (1 satoshi = 0.00000001 BTC) [25] |
| Intermediaries | Banks, card networks, processors | Peer-to-peer (P2P) network; in practice, many people use exchanges |
| Reversibility | Reversals possible with several payment methods | A confirmed transaction cannot be reversed |
| Privacy | Banknotes don't record who pays; bank accounts do | Pseudonymous: addresses carry no name, but transactions are public |
| Durability | Banknotes wear out and are replaced by the central bank; lower denominations wear out sooner — in 2012, about 70% of R$2 and R$5 notes were fit to circulate, compared with about 85% of R$10 to R$100 notes [26] | The ledger persists as long as the network is maintained |
Advertisements
Beyond Bitcoin
- DeFi (decentralized finance): lending and trading run by smart contracts, with no bank in the middle. They carry risks of their own: code flaws, attacks and loss of collateral.
- Stablecoins: crypto-assets that seek parity with a stable asset, such as the dollar — for example, USDT (Tether) and USDC (Circle). Their stability depends on the reserves and on the reliability of the issuing company.
- Smart contracts: agreements whose clauses are code. They reduce the need to trust the other party, but require trust in the code instead — which can have bugs.
- CBDCs (central bank digital currencies): digital versions of fiat currencies, issued by the
central bank. The projects differ widely from one another:
- Drex (Brazil): it was designed as a wholesale platform — the Central Bank would issue Drex to financial institutions, and the public would use tokenized deposits at banks, without an account at the Central Bank [27]. In , in its report on the first phase of the pilot, the Central Bank concluded that the privacy solutions tested still had limitations that, at that point, compromised their adoption; in , a Central Bank deputy governor stated that the second phase was assessing use cases to broaden the range of assets that can be pledged as collateral [28]. It is an ongoing project: its current status should be checked with Brazil's Central Bank.
- Digital euro: in , the European Central Bank decided to move to a new preparation phase; a pilot may start in , and the first issuance depends on European legislation still under discussion [29].
- Digital yuan (e-CNY): it is the world's largest retail CBDC pilot; since , balances held at authorized banks can earn interest [30].
In general, CBDCs allow more traceability than banknotes; the degree of privacy depends on each project's design and on each country's law.
Comparison table: types of digital currency
| Dimension | Cryptocurrency (Bitcoin) | Stablecoin (USDC) | Retail CBDC (e-CNY) |
|---|---|---|---|
| Control | Decentralized network | Issuing company | Central bank |
| What sustains its value | Scarcity defined in the protocol, and acceptance | Reserves held by the issuer | The national currency |
| Volatility | High | Low as long as the peg holds | None relative to the national currency |
| Privacy | Pseudonymous and public | Traceable by the issuer | Depends on design and law |
| Access | Open to anyone | Usually through exchanges and wallets | Through banks and authorized institutions |
Advertisements
Sources
All online sources accessed on September 15, 2026.
- NAKAMOTO, Satoshi. Bitcoin: A Peer-to-Peer Electronic Cash System, 2008. · Bitcoin Wiki. Controlled supply. https://bitcoin.org/bitcoin.pdf · https://en.bitcoin.it/wiki/Controlled_supply
- BANCO CENTRAL DO BRASIL. Relatório da Administração 2012 — Dinheiro em circulação. https://www.bcb.gov.br/Pre/Surel/RelAdmBC/2012/o-banco-central-do-brasil-e-a-sociedade/cidadania-e-sistema-financeiro/dinheiro-em-circulacao.html
- BANCO CENTRAL DO BRASIL. A moeda digital oficial brasileira (Drex) — referências básicas, nov. 2023. · AGÊNCIA BRASIL. Entenda o que é e como funcionará o real digital, 8 ago. 2023. https://www.bcb.gov.br/content/estabilidadefinanceira/real_digital_docs/drex_referencias_basicas_nov2023.pdf · https://agenciabrasil.ebc.com.br/economia/noticia/2023-08/entenda-o-que-e-e-como-funcionara-o-real-digital
- BANCO CENTRAL DO BRASIL. Relatório do Piloto Drex — Fase 1, fev. 2025, cap. 6 (Conclusões), p. 65. · GOMES, Renato Dias de Brito (diretor do Banco Central do Brasil). Emerging technologies, lessons from Pix and Drex, and future perspectives. Digital Money Summit, Londres, 20 maio 2025. BIS, Central bankers' speeches. https://www.bcb.gov.br/content/estabilidadefinanceira/real_digital_docs/piloto/Relatorio_Drex_piloto_fase_1.pdf · https://www.bis.org/review/r250703g.htm
- EUROPEAN CENTRAL BANK. Eurosystem moving to next phase of digital euro project, 30 out. 2025. · EUROPEAN PARLIAMENT. Digital euro: MEPs ready to start negotiations, 9 jul. 2026. https://www.ecb.europa.eu/press/pr/date/2025/html/ecb.pr251030~8c5b5beef0.en.html · https://www.europarl.europa.eu/news/en/press-room/20260708IPR46377/digital-euro-meps-ready-to-start-negotiations
- THE STATE COUNCIL OF THE PEOPLE'S REPUBLIC OF CHINA. China to enhance digital yuan management with deposit features starting 2026, 29 dez. 2025. https://english.www.gov.cn/news/202512/29/content_WS69526d4ec6d00ca5f9a08511.html
- BRASIL. Lei nº 14.478, de 21 de dezembro de 2022. https://www.planalto.gov.br/ccivil_03/_ato2019-2022/2022/lei/l14478.htm