Brazils CBDC Pilot Welcomes Visa, Santander, and Local Banks

Brazils CBDC Pilot Welcomes Visa, Santander, and Local Banks

The Brazilian CBDC pilot project attracts participation from national and global companies, with over 100 institutions considered for participation, and the pilot phase testing privacy and programmability features of the CBDC.

  • The Brazilian CBDC pilot project has attracted participation from national and worldwide companies.
  • Over 100 institutions have been considered for participation.
  • The pilot phase has focused on testing the privacy and programmability features of the CBDC.

The next pilot project for the monetary authority digital currency (CBDC) in Brazil will witness the active participation of both domestic and international enterprises. Banco Central do Brasil, the nation’s monetary authority, has scheduled the inclusion of participants onto the digital real platform to commence in mid-June of 2023.

On May 24, the monetary authority publicly disclosed the definitive roster of CBDC pilot participants. Out of 36 submissions from individual corporations and consortia, 14 entities were in the end chosen to engage, with certain participants representing conglomerates. 

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Tech Giants and Banks Collaborate in Brazil’s Digital Real Pilot

Notable examples include Microsoft, the American tech behemoth; Banco Inter, a Brazilian financial institution; and 7COMm, a digital technology company.

The other selected participants are Visa, Santander, and numerous Brazilian banking establishments such as Itaú Unibanco, BTG Pactual, and Banco Bradesco.

In the ongoing phase of the digital real pilot, the monetary authority intends to evaluate the privacy and programmability functionalities of its platform through a specific use case: a delivery versus payment protocol for federal public securities.

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The official notice of the Brazilian CBDC pilot took place in 2022. The digital real, whose value would be linked to the national fiat currency, the real, is designed to have a fixed supply and will be gradually minted over time.

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As the largest country in Latin America, boasting a population of 214 Million, Brazil persists to captivate worldwide digital currency companies. 

In January, Binance Crypto exchange and Mastercard forged a partnership to introduce a prepaid cryptocurrency card within the country. Since March, Coinbase Crypto exchange has collaborated with local payment providers to support digital currency purchases and enable deposits and withdrawals in the native currency. 

Furthermore, on May 19, the monetary authority granted Latam Gateway, the payment service provider for Binance Crypto exchange in Brazil, a license to operate as a payment institution and electronic money issuer.

The other side

  • The participation of worldwide corporations in the Brazilian CBDC pilot project may overshadow local enterprises and hinder domestic innovation.
  • The pilot project’s focus on a delivery versus payment protocol for federal public securities raises questions about exploring a broader range of use cases.
  • The CBDC pilot’s effectiveness in addressing the financial inclusion challenges of marginalized communities remains uncertain owing to barriers such as limited access to digital infrastructure and technological literacy.
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Why This Matters

With renowned enterprises venturing into the monetary authority digital currency realm, which shows a growing understanding and adoption of digital currencies by influential players, potentially paving the way for wider acceptance and integration of digital currencies in the broader market.

To learn more about how Ripple’s CBDC platform is unlocking financial inclusion worldwide, read here:

New Ripple CBDC Platform: Unlocking Financial Inclusion Worldwide

To stay updated on Governor DeSantis and Kennedy Jr.’s united opposition to CBDCs, read here:

DeSantis & Kennedy Jr. United in Opposition to CBDCs


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