Federal Representative’s Statement
Brazil is now working on a new measure that will tokenize all gold mined there on a blockchain to increase transparency and discourage illegal mining. Federal Representative Joenia Wapichana, who introduced the initiative, emphasises that around half of the nation’s metal mining takes place in illicit activities.
According to her, the majority of this gold originated from the Amazon and represents over half of the country’s production. Gold mining has a significant negative influence on the environment since it can contaminate land, groundwater, and rivers by releasing chemicals and heavy metals
The bill states that as been frequently reported by the national and international press, as well as by civil society organizations that fight for the protection of the forest and the guarantee of indigenous rights, these operations are accompanied by mercury contamination, violence, and deforestation. The idea seeks to create new laws that would be recorded on a blockchain and apply to the buying, selling, and trading of gold in the nation.
The Asset Tokenization
The lawmaker continued by saying that the National Mining Agency is required to put into place a single digital system with secure records using blockchain technologies to combine all data and processes of mineral operations with the additional electronic records and documentation on transactions and sales, which will even let you create alerts for inspection. This will improve inspection and provide transparency to the industry. Regarding the project’s execution, no technical information was given, nor was it specified which blockchain network should be used.
One of the wonderful services offered by blockchain technology is asset tokenization. Tokens that represent different financial assets, including as commodities, stocks, and other securities, may be created by any company or institution and stored on open blockchain networks. The demand for tokenized gold is increasing on a global scale. The market capitalization of Paxos Gold (PAXG), the company’s precious metal-backed token, is presently above $600 million, whereas that of Tether Gold (XAUT), a rival, is $440 million.