The Central Bank of Brazil (BCB) is advancing its digital currency framework initiative (CBDC) by partnering with Banco Inter, Microsoft Brazil, 7COMm and Chainlink, according to a Nov. 19 statement.
The partnership aims to support trade finance solutions in the second phase of Brazil’s DREX pilot program. This phase will focus on automating cross-border settlements for commodity transactions using blockchain technology and oracles.
The role of Chainlink
The test uses Chainlink’s Cross-Chain Interoperability Protocol (CCIP) to enable seamless interactions between Brazil’s DREX platform and foreign central banks.
The initiative will tokenize an electronic bill of lading (eBOL) and integrate supply chain data to automate payments. This data-driven approach ensures that exporters get paid at different stages of the shipping process.
The pilot aims to demonstrate how blockchain-based trade finance enables Delivery versus Payment (DvP) and Payment versus Payment (PvP). These mechanisms aim to improve efficiency, safety and transparency in the global supply chain, especially agricultural commodities.
Banco Inter will lead the implementation of the DREX platform in Brazil, while Microsoft Brazil and 7COMm will provide cloud services and technical support. Chainlink’s CCIP infrastructure will facilitate cross-chain transfers for DREX and other CBDCs.
Improving market access
Bruno Grossi, head of emerging technologies at Banco Inter, highlighted the project’s potential to expand market access and strengthen Brazil’s economic landscape.
Similarly, Microsoft Brazil said its role in DREX is to broaden access to intelligent financial services and play a key role in the development of the country’s economy.
Meanwhile, Angela Walker, the Global Head of Banking and Capital Markets at Chainlink Labs, noted that the pilot would transform trade finance by demonstrating how tokenized assets can unlock new CBDC applications in Brazil.
She added:
“Chainlink CCIP is essential for enabling secure cross-border, cross-currency and cross-chain transactions and will help demonstrate what tokenized assets can do at scale for this important CBDC use case in Brazil.”