Has Brazil Invented the Future of Money? – Paul Krugman(paulkrugman.substack.com)
paulkrugman.substack.com
Has Brazil Invented the Future of Money? – Paul Krugman
https://paulkrugman.substack.com/p/has-brazil-invented-the-future-of
15 comments
Disregarding the law (I'm ignorant) - why should PIX be "auditable"?
Almost everyone (very close to literally everyone) uses PIX and we have zero reported cases of mishap, errors or bad faith attacks...?
I quite frankly don't care that the system backed/created by the public services and imposed on banks is "closed"; to the point I'm generally curious as to what are the arguments for caring
Hope this does not sound dismissive - as a heavy user with no complaints for years, why should I care PIX is a black box?
Almost everyone (very close to literally everyone) uses PIX and we have zero reported cases of mishap, errors or bad faith attacks...?
I quite frankly don't care that the system backed/created by the public services and imposed on banks is "closed"; to the point I'm generally curious as to what are the arguments for caring
Hope this does not sound dismissive - as a heavy user with no complaints for years, why should I care PIX is a black box?
> Almost everyone (very close to literally everyone) uses PIX and we have zero reported cases of mishap, errors or bad faith attacks...?
Earlier this month, hackers using credentials purchased from a C&M employee were able to generate unauthorised PIX transactions on client banks and steal at least BRL$ 500 MM, and maybe as much as BRL $ 5 BN, so it's definitely not fool proof.
> Hope this does not sound dismissive - as a heavy user with no complaints for years, why should I care PIX is a black box?
Brazilians in general are very accepting of government surveillance, with the omnipresent CPF and now complete disclosure of almost all consumer transactions to the State. It's always surprised me, TBH, given the very recent history of dictatorship and unbounded potential for abuse.
Earlier this month, hackers using credentials purchased from a C&M employee were able to generate unauthorised PIX transactions on client banks and steal at least BRL$ 500 MM, and maybe as much as BRL $ 5 BN, so it's definitely not fool proof.
> Hope this does not sound dismissive - as a heavy user with no complaints for years, why should I care PIX is a black box?
Brazilians in general are very accepting of government surveillance, with the omnipresent CPF and now complete disclosure of almost all consumer transactions to the State. It's always surprised me, TBH, given the very recent history of dictatorship and unbounded potential for abuse.
> Earlier this month, hackers using credentials purchased from a C&M employee were able to generate unauthorised PIX transactions
To be clear - This was a "bank robbery" (inside job, given usage of credentials?) and in absolutely zero ways affects trust in Pix as a user
As for your other point - thanks, our values and concerns are not aligned; it would be hard for us to agree on this
To be clear - This was a "bank robbery" (inside job, given usage of credentials?) and in absolutely zero ways affects trust in Pix as a user
As for your other point - thanks, our values and concerns are not aligned; it would be hard for us to agree on this
> To be clear - This was a "bank robbery" (inside job, given usage of credentials?) and in absolutely zero ways affects trust in Pix as a user
Well, that doesn't appear to have been the case. Instead it seems to have been an attack that leverage a as-yet-unknown weakness in the Pix protocol that seems to have allowed something similar to impersonation. Whether it has affected your trust in Pix is almost immaterial, as it has rocked institutional trust in the protocol and platform.
As for user trust, with endless malware attacks like PixPirate, PixBankBot, GoPix, etc,
> As for your other point - thanks, our values and concerns are not aligned; it would be hard for us to agree on this
That's an interesting claim - how do you know my values and concerns?
Well, that doesn't appear to have been the case. Instead it seems to have been an attack that leverage a as-yet-unknown weakness in the Pix protocol that seems to have allowed something similar to impersonation. Whether it has affected your trust in Pix is almost immaterial, as it has rocked institutional trust in the protocol and platform.
As for user trust, with endless malware attacks like PixPirate, PixBankBot, GoPix, etc,
> As for your other point - thanks, our values and concerns are not aligned; it would be hard for us to agree on this
That's an interesting claim - how do you know my values and concerns?
I fail to see the relevance here - the APIs are public, but the software running the system isn’t. This is not great, but it isn’t significantly different from any other similar platform.
Also, it’s not complicated to build your own PIX system from reverse engineering the APIs. In fact, it’s quite trivial. The tricky part is to make it scalable.
Also, it’s not complicated to build your own PIX system from reverse engineering the APIs. In fact, it’s quite trivial. The tricky part is to make it scalable.
“Brazil back in 2020 it introduced Pix, a digital payment system run by the central bank. As I understand it, Pix is sort of like a publicly run version of Zelle, the payment system operated by a consortium of U.S. private banks. But Pix is much easier to use. And while Zelle is big, Pix has become simply huge, used by a reported 93 percent of Brazilian adults.” I was unaware of how popular and widespread Pix’s adoption was. Similar ideas were planned and implemented in other parts of the world long before PIX, so they did have a good reference like the RIX payment system in Sweden and FAST in Singapore.
It’s good that the Brazilian Central Bank took a proactive approach.
RIX is a completely different concept to Pix, being focused on large transactions and FAST is more comparable to SEPA Instant.
Pix is more comparable to India's UPI, which was certainly a reference.
Pix is more comparable to India's UPI, which was certainly a reference.
What Pix needs now to continue soaring is a growing ecosystem of startups using it as the exclusive payment system.
It would also be great if something similar to Pix was released for messaging.
It would also be great if something similar to Pix was released for messaging.
If you have cash and you go get a haircut for $50.
Then the hairstylist uses that $50 to buy groceries.
Then the grocery uses that $50 to buy boxes.
Then the box people use that $50 to buy wood.
The $50 keeps going.
Why the government wants to do away with cash and go to this system.
$50 minus fees.
$49 minus fees.
$48 minus fees.
Not to mention the ability to digitally print money has caused tremendous inflation and that's about to get much worse.
>Republicans say that they’re worried about invasion of privacy, that a CBDC would open the door to widespread government surveillance. But remember, these are the people who have handed over personal Medicaid data to ICE to facilitate arrests and abductions.
So proving the point literally 100%? That the USA already has widespread government surveillance and nobody ever did anything about it?
Then the hairstylist uses that $50 to buy groceries.
Then the grocery uses that $50 to buy boxes.
Then the box people use that $50 to buy wood.
The $50 keeps going.
Why the government wants to do away with cash and go to this system.
$50 minus fees.
$49 minus fees.
$48 minus fees.
Not to mention the ability to digitally print money has caused tremendous inflation and that's about to get much worse.
>Republicans say that they’re worried about invasion of privacy, that a CBDC would open the door to widespread government surveillance. But remember, these are the people who have handed over personal Medicaid data to ICE to facilitate arrests and abductions.
So proving the point literally 100%? That the USA already has widespread government surveillance and nobody ever did anything about it?
PIX is free for the users and imposes a very, very small fee (much smaller than any other non-cash payments) for banks etc.
(and cash is not usable for large amounts)
(and cash is not usable for large amounts)
It appears so, but that 50$ doesn’t keep going. What happens, for example, when the grocery gets robbed? That 50$ becomes 0$. When money’s involved, whether it’s debit/credit or cash, there’s always a money management cost involved, and cash usually has a much higher cost than debit or credit.
> The $50 keeps going.
Every part of the chain currently pay fees unless they are paying with cash.
> Not to mention the ability to digitally print money has caused tremendous inflation and that's about to get much worse.
Governments can print money physically as well. Also, most money in circulation never needs to be printed because it never leaves the banking system.
> So proving the point literally 100%?
Do you think banks would resist to giving the government your transaction history?
Every part of the chain currently pay fees unless they are paying with cash.
> Not to mention the ability to digitally print money has caused tremendous inflation and that's about to get much worse.
Governments can print money physically as well. Also, most money in circulation never needs to be printed because it never leaves the banking system.
> So proving the point literally 100%?
Do you think banks would resist to giving the government your transaction history?
>Every part of the chain currently pay fees unless they are paying with cash.
I literally said cash as the 4th word typed.
>Governments can print money physically as well. Also, most money in circulation never needs to be printed because it never leaves the banking system.
Printing money back in the 1930s had to be done physically; and was at the consequence of gold.
Subsequent bad US presidents, roosevelt and nixon wrecked the usa ultimately; and they are paying for it now.
>Do you think banks would resist to giving the government your transaction history?
How do the banks know how i spent my cash?
I literally said cash as the 4th word typed.
>Governments can print money physically as well. Also, most money in circulation never needs to be printed because it never leaves the banking system.
Printing money back in the 1930s had to be done physically; and was at the consequence of gold.
Subsequent bad US presidents, roosevelt and nixon wrecked the usa ultimately; and they are paying for it now.
>Do you think banks would resist to giving the government your transaction history?
How do the banks know how i spent my cash?
> I literally said cash as the 4th word typed.
How many companies use cash as a primary means of payment?
> How do the banks know how i spent my cash?
That info would be inferred from the data the phone, social media, and other surveillance companies offer. They'd know to keep an eye on you because you transact too much using cash.
How many companies use cash as a primary means of payment?
> How do the banks know how i spent my cash?
That info would be inferred from the data the phone, social media, and other surveillance companies offer. They'd know to keep an eye on you because you transact too much using cash.
But here's the problem: PIX’s source code is not public.
No external institution—be it a citizen, a researcher, a company, or even another government agency—can audit how PIX operates under the hood. This directly contradicts both the letter and the spirit of Article 16 of Law 14.063/2021.
https://d1gesto.blogspot.com/2025/06/brazils-pix-system-face...