A Brazilian legislator has proposed tokenizing every blockchain mined in the country. This proposal was proposed by a lawmaker in reaction to illicit mining occurring in the country. The new bill, according to Federal Representative Joenia Wapichana, will promote accountability in the sector.
A Blockchain Gold Tokenization Bill
Joenia Wapichana, who supports the new bill, mentions illicit trafficking in the Amazon. According to her, the Amazon supplied half of the country’s gold supply. They are, nevertheless, all the result of unlawful mining.
According to the local media website Boletim Bitcoin, mining activity has a significant impact on the environment. By discharging toxic elements, the soil and water supplies are affected. Furthermore, the influence of mercury on groundwater makes it difficult to obtain safe drinking water.
However, one of the many effects of illegal mining, according to the legislator, is violence and degradation. The civil rights movement as well as the national and international press, supported the lawmaker’s remarks.
As a result, the measure seeks to create new guidance for the country’s gold mining, trading, and purchase. This would be recorded on a blockchain network in order to assure compliance and transparency.
The Federal Mining Agency, according to the lawmaker, will develop a single digital platform.
Nevertheless, no further information about the blockchain network to be used, nor the policy’s application, is provided.
Asset Tokenization Is Increasing on the Blockchain Network
Blockchain technology allows commercial and governmental organisations to adopt and use a variety of utilities. Asset tokenization is one of the numerous functionalities.
Tokens reflecting various items such as securities, goods, or stocks can be issued by institutions or companies.
As a result, the gold price has adopted tokenization in order to clean up the system and maintain effectiveness. And the introduction of blockchain-based cryptocurrencies has resulted in asset tokenization.
Gold-backed coins are growing in popularity among stock market participants and dealers. Not only is tokenized gold popular, but it has also expanded into emerging businesses and allows consumers to deposit their funds.
According to most financial experts, tokenization began with gold, and blockchain-based tokenization is an added benefit. According to industry experts, over $544 trillion in assets will be tokenized over the next several years.
Financial regulators are putting policies in place and building infrastructure to accommodate the new development. Furthermore, the moment has arrived for institutions to deploy tokenized assets.
However, it would necessitate specific guidelines, just like any newly generated item. The tax process, security system, and regulatory frameworks are all required for its implementation. Investors require a quick technique to navigate the sector in order to avoid asset loss difficulties.
Gold has always been regarded as a reliable store of value by investors. In times of economic insecurity and upheaval, it is preferred over fiat.
Large shareholders will have easy accessibility to their funds following the tokenization of gold on the blockchain.