Visa, Microsoft, and major institutions to participate in Brazilian CBDC pilot project

Brazil’s central bank is set to launch its pilot project for a CBDC

Brazil’s central bank is set to launch its pilot project for a central bank digital currency (CBDC), with the participation of both national and global companies. The Banco Central do Brasil plans to onboard participants onto its digital real platform starting in mid-June 2023.

Recently, the central bank announced the final list of participants for the CBDC pilot, selecting from a pool of 36 bids submitted by individual companies and consortia, representing over 100 institutions. The total number of participants in the pilot is 14, with some groups of companies included. Notably, Microsoft, Banco Inter (a Brazilian bank), and digital technology company 7COMm form one of the 14 participants.

Joining them are renowned entities such as Visa, Santander, and several leading Brazilian banking institutions like Itaú Unibanco, BTG Pactual, and Banco Bradesco.

During this phase of the digital real pilot, the central bank will focus on testing the platform’s privacy and programmability features through a specific use case: a delivery versus payment protocol for federal public securities.

The Brazilian CBDC pilot was officially announced in 2022 and is designed to have the digital real’s value pegged to the national fiat currency, the real. The digital real will have a fixed supply and be gradually minted over time.

As the largest country in Latin America, Brazil continues to attract global crypto companies. In January, Binance and Mastercard collaborated to introduce a prepaid crypto card in the country. Since March, Coinbase has partnered with local payment providers to facilitate crypto purchases and enable deposits and withdrawals in the local currency. Additionally, the central bank recently granted Latam Gateway, the payment provider for Binance in Brazil, a license to operate as a payment institution and electronic money issuer.

With the participation of major players like Visa, Microsoft, and leading financial institutions, the Brazilian CBDC pilot project marks a significant step toward the adoption of digital currencies in the country’s financial ecosystem. The pilot will serve as an important testing ground for the privacy and programmability features of the digital real platform, paving the way for potential future advancements in the digital currency space.

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