Visa to Develop Brazilian Blockchain-powered CBDC Project
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The payments giant Visa has unveiled a new blockchain and central bank digital currency (CBDC) project in Brazil.
Per the Brazilian media outlet Livecoins, the firm was selected by the Brazilian central bank to “explore” blockchain technology-powered “usage cases” for the prototype digital real.
The bank is hopeful of debuting its coin later this year.
It has also claimed that the coins will be designed with a view to helping local businesses.
Visa’s offering was created in partnership with Agrotoken, Microsoft, and Sinqia.
The firm’s solution is a financial platform designed for small and medium-sized enterprises (SMEs).
Visa said the solution would be of particular interest to small-scale farmers and agricultural firms.
The platform comprises an interoperability solution, a Visa innovation called Universal Payment Channel (UPC).
Using UPC, the firm claims, traders and companies “can make a connection between” the Brazilian CBDC and “other CBDCs, stablecoins, or tokenized deposits.”
This, the four firms claimed, will allow agricultural industry players to use the digital real “in different markets and networks.”
And the firms said that the platform would help “expand the financing options available for SMEs to fund their business securely and frictionlessly.”
It will also “reduce the inconvenience caused by a lack of access to traditional services,” they said.
Visa’s Blockchain-powered CBDC Project – Will It Take off in Brazil?
Catherine Gu, the Global Head of CBDC at Visa, gave the example of “enabling a [Brazilian] soybean producer to create and auction – globally – a contract that has been tokenized on an authorized version of the Ethereum blockchain, using different interoperable forms of money.”
The platform, its developers claim, brings existing financial processes and assets onto the blockchain protocol.
This move, they say, will “allow farmers to tokenize traditional contracts.”
To do this, Visa said that it had made use of the “agricultural commodity tokenization expertise” of Agrotoken.
BREAKING: 🇧🇷 Brazil's president Lula supports creating new currency for trade between BRICS nations, and ditching the US dollar – Reuters pic.twitter.com/5jB4pM6wFG
— Radar🚨 (@RadarHits) April 26, 2023
Visa claimed that doing so allowed it to transform existing Brazilian legal documents into “on-chain, tradable non-fungible tokens (NFTs).”
The payments firm added that it had developed an on-chain “sealed-bid auction solution.”
This solution uses smart contract technology, Visa said.
This, Visa claimed, will allow a pool of global blockchain investors to “participate in the funding process” for SME financing.
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