Brazil may become the world's largest official Bitcoin holder!!!

Recently, the Brazilian House of Deputies took a major step. They submitted an alternative proposal regarding the "National Bitcoin Strategic Reserve." The document is quite thick, and one figure stands out: accumulating at least 1 million Bitcoins within 5 years. This is no small feat. If it succeeds, Brazil could immediately take the top spot as the world's official Bitcoin holder, surpassing the United States, El Salvador, and other countries.

This story begins in November 2024. At that time, a legislator named Eros Biondini proposed Bill PL 4501/2024. The initial idea was relatively conservative—simply allocating 5% of the country's foreign exchange reserves to buy Bitcoin, roughly around $18 billion. But by February 2026, the alternative proposal from the House of Representatives' Economic Development Committee (CDE) took a completely different approach. They no longer wanted to be just "holders" but aimed to establish a comprehensive "National Bitcoin Ecosystem Support Framework." In simple terms, they want not only to buy Bitcoin but also to integrate it into Brazil's financial system so it can truly circulate.

What does holding 1 million Bitcoins mean?
Bitcoin's total supply is 21 million coins, so Brazil would be taking nearly 5% of that. Based on current market prices, this would be worth approximately $117 billion. This exceeds the previous 5% foreign exchange reserve cap by a significant margin. Moreover, they plan to acquire not only through purchase but also by seizing Bitcoin confiscated by courts.
The bill explicitly states that any Bitcoin confiscated through anti-money laundering or drug enforcement actions must not be auctioned but transferred entirely into the national reserve wallet. This move is quite aggressive, effectively "confiscating" assets directly to accelerate reserve accumulation.
To ensure Bitcoin can truly circulate, the bill also includes a series of "soft" measures.
For example, allowing citizens and businesses to pay taxes with Bitcoin. Imagine the liquidity boost if Bitcoin could be used for tax payments.
Additionally, they plan to exempt capital gains on digital assets from income tax. This means profits from buying and selling Bitcoin wouldn't be taxed. The goal is clearly to encourage long-term holding and discourage short-term speculation.
Most importantly, the bill emphasizes "user sovereignty." It explicitly guarantees self-custody rights and permissionless transfers. In plain terms, your coins are yours to control—whether to store in your wallet or transfer to anyone—without government interference like managing bank accounts.
This is a response to previous concerns about Central Bank Digital Currencies (CBDCs), fearing excessive government control and privacy invasion.

Why is Brazil suddenly so aggressive?
There are deep strategic considerations behind this. As a core member of BRICS, Brazil has been contemplating "de-dollarization."
Bitcoin, which doesn't rely on the Federal Reserve or the SWIFT system, is based on mathematics and code—completely neutral. For countries seeking to escape U.S. dollar dominance, Bitcoin is an excellent "digital anchor."
Brazil's move not only seeks a backup plan for itself but also sets an example for other developing countries.
Of course, this isn't without opposition. The Central Bank and the Ministry of Finance have strongly opposed it.
The Central Bank argues that Bitcoin's volatility is too high, with an annualized volatility of around 45%. How can it serve as foreign exchange reserves? If prices crash, the reserves would shrink. Plus, where would the money come from to buy so much Bitcoin? Would they use existing foreign reserves or issue special government bonds? Given Brazil's current fiscal deficit, this is a significant issue.
The alternative proposal is still under review by the House of Deputies' Economic Development Committee (CDE) and hasn't yet gone to a full vote. The next step depends on whether the Ministry of Finance can be persuaded and whether enough cross-party support can be gathered. If it passes, 2026 could truly become the "Year of National Bitcoin Adoption."