Most people probably don’t think of Brazil as a leader in financial innovation. But Brazil’s political economy is clearly very different from ours — for example, they actually put former presidents who try to overturn elections on trial. And the interest groups whose power, for now at least, makes a U.S. digital currency impossible appear to have much less sway there. Brazil is, in fact, planning to create a CBDC. As a first step, 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. It appears to be rapidly displacing both cash and cards:

Pix transactions take place almost instantaneously.

Transaction costs are low.