Brazil’s DREX CBDC Project Boosted By Chainlink, Microsoft, And Banco Inter: Report

Aria Rose
By Aria Rose Add a Comment
5 Min Read
Brazil's DREX CBDC Project Boosted By Chainlink, Microsoft, And Banco Inter: Report

The Central Bank of Brazil (BCB) has advanced its CBDC initiative, selected financial services firm Banco Inter, tech giants Microsoft Brazil, 7COMm, and smart contract platform Chainlink to develop a new trade finance system based on blockchain technology. This is a part of the second phase of the Brazil Digital Real (DREX) pilot program. The initiative will also provide supply chain finance and improve trade finance processing as well as supply chain management. The model seeks to improve the efficiency of the cross border, cross-platform and cross-currency agricultural commodity transactions.

Brazil's DREX CBDC Project Boosted By Chainlink, Microsoft, And Banco Inter: Report = The Bit Journal

Blockchain and oracles will be applied to perform the settlement of the suggested solution’s process. This will tokenize the Electronic Bill of Lading (eBoL) and, applying supply chain data, it will disburse payments to exporters during transit. The project is intended to improve the functioning, security, and productivity of the international trade systems.

CBDC and Cross-Border Transactions

Chainlink’s Cross-Chain Interoperability Protocol (CCIP) will be the main part of the project. This protocol is expected to assist Brazil’s DREX in integrating with foreign CBDCs, thereby facilitating efficient cross-border business. This interoperability will improve and facilitate faster and more secure international trade. It will also enable the conclusion of transactions in different currencies and on different blockchains.

Joao Bruno Grossi, Head of Emerging Technologies at Banco Inter stated:

“Banco Inter sees Phase 2 of the DREX CBDC project as an exciting moment for Brazil. We see collaborating in this project with technology leaders like Microsoft and Chainlink Labs as a transformative opportunity to expand market reach and improve the health of the Brazilian market.”

The pilot will demonstrate that blockchain can improve the Delivery versus Payment (DvP) and Payment versus Payment (PvP). These practices are useful in enhancing trade finance. DvP is inevitable when goods are delivered so that payments are made after the right time has been reached. In PvP, payment is made when both the parties have provided what the other party agreed to provide.

Angela Walker, Global Head of Banking and Capital Markets at Chainlink Labs emphasized the role of CCIP. She stated:

Advertisement Banner

“Chainlink CCIP is essential to enabling secure cross-border, cross-currency, and cross-chain transactions and will help showcase what tokenized assets can do at scale for this key CBDC use case in Brazil.”

Microsoft’s Blockchain Support

Microsoft, which has been supporting blockchain for years, will offer the cloud solution for the DREX project. ”Microsoft is pleased to be working with the Central Bank of Brazil, Banco Inter, 7COMm and Chainlink Labs on Brazil’s DREX digital currency,” said Aragao, Innovation Specialist for Financial Services at Microsoft. For DREXs development, Microsoft provides the technology that is useful for the improvement of inclusive and quality financial services. This partnership will also help Brazil grow economically by integrating blockchain.

CBDC

7COMm, being a solutions provider, will concentrate on technical support. Sergio Yamani, Chief Innovation and New Business Development Officer at 7COMm, stated that:

“The advent of CBDCs, the development of blockchain interoperability protocols such as CCIP, and the use of CBDCs for cross-border payments enable a new generation of blockchain trade finance solutions. We are confident that we will deliver a solution with a well-designed and thoughtful value proposition that solves real, everyday business problems.”

Chainlink’s Security Infrastructure

Chainlink Labs is one the biggest companies in the sphere of blockchain technology and is also the participant of the project. This will enable secure data and cross-chain communication which will be a major boost to DREX’s expansion. The firm has helped complete over $16 trillion in transactions through blockchain technology. The Chainlink solutions will enable DREX to engage other blockchains, meaning that DREX will be capable of harnessing the full potential of digital currency. 

CBDC

The DREX is a financial system benchmarked programme that will transform trade finance in Brazil. Thus, the use of automated payment settlements will increase the effectiveness of the global supply chain. This partnership between the Central Bank of Brazil, Banco Inter, Microsoft, 7COMm, and Chainlink is the future for the world business.

Disclaimer

The price predictions and financial analysis presented on this website are for informational purposes only and do not constitute financial, investment, or trading advice. While we strive to provide accurate and up-to-date information, the volatile nature of cryptocurrency markets means that prices can fluctuate significantly and unpredictably.

You should conduct your own research and consult with a qualified financial advisor before making any investment decisions. The Bit Journal does not guarantee the accuracy, completeness, or reliability of any information provided in the price predictions, and we will not be held liable for any losses incurred as a result of relying on this information.

Investing in cryptocurrencies carries risks, including the risk of significant losses. Always invest responsibly and within your means.

Share This Article
Areeba Rashid is a dedicated crypto news writer with a passion for making complex topics accessible to everyone. She covers the latest developments in the crypto world, including in-depth price analysis, helping readers stay informed and make sense of market trends.
Leave a Comment