The Brazilian Central Bank is opening the drex CBDC pilot to new entrants, aiming to test more advanced use cases and privacy solutions for the project’s second phase. Thirteen use cases have been confirmed, including carbon credits, agricultural bonds, and foreign trade platforms.
Brazilian Central Banks Opens CBDC Pilot to New Consortiums
Brazil is preparing to deepen the activities surrounding its central bank digital currency (CBDC) pilot, drex. The Central Bank of Brazil announced the pilot project’s opening to more participants, aiming to expand the testing of more complex use cases in the platform. New consortiums will be able to present their proposals to be reviewed by the project’s executive management committee from October 14 to November 29.
The approved proposals will join the already approved 13 use cases featuring complex applications of the tokenized real including credit collateralization, government-backed loans, international trade financing, and carbon credit platforms, among others.
These new use cases join the 16 consortiums as part of the first phase of this pilot. One of the most relevant elements of this new phase is introducing and testing privacy solutions capable of maintaining the parameters needed for drex’s operativity.
The failure of the privacy proposals presented in the first phase of the pilot prompted the central bank to delay drex’s completion until 2025, taking the opportunity to introduce new use cases to be tested.
However, implementing drex on a wider scale, including the general population, will not be possible until these privacy solutions prove robust enough to comply with drex’s requirements. Consequently, there is no clear date for the launch of drex, but a 2025 rollout, as earlier estimations predicted, seems unlikely due to the tight timeframe.
During the announcement of this new phase, the President of the Brazilian SEC-equivalent Joao Pedro Nascimento acknowledged that tokenization is a business that has staying power and stated crypto should be brought to the financial system in a regulatory-compliant way.
