The Central Bank of Brazil has initiated the second phase of its central bank digital currency project, DREX, aiming to demonstrate trade finance as a new use case.
In a press release on Nov. 19, Brazil’s central bank announced it had selected Chainlink (LINK), Banco Inter, Microsoft and 7COMm to participate in phase 2 of the pilot for its digital currency project.
The solution leverages blockchain technology and oracle networks to automate supply chain management and enhance trade finance processes.
In this phase, the initiative will utilize Chainlink’s cross-chain interoperability protocol to facilitate interoperable transactions between the pilot and a foreign central bank, with a focus on compatibility and efficient settlement of transactions.
“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.”
Angela Walker, global head of banking and capital markets at Chainlink Labs
DREX phase 2 will commence in coming weeks
According to BCB, the pilot will involve partners collaborating to tokenize an Electronic Bill of Lading on-chain, triggering payments to exporters using supply chain data.
Targeted for the entire shipping process, Drex aims to illustrate the benefits of blockchain-based trade finance. Per the announcement, this includes the quest to unlock DvP and PvP securities settlement processes.
Key also will be supply chain efficiency, security and transparency across the agricultural commodities global trade. Infrastructure development for the pilot’s second phase will commence in coming weeks, BCB said.
Microsoft is the cloud services provider for the pilot project, while 7COMm offers technical support.
Meanwhile, Chainlink’s infrastructure continues to see adoption in various applications and programs, including asset tokenization. Partners using its services include Swift, Fidelity International, ANZ, and UBS.
