Brazil’s BV Bank is involved in one of 16 pilots for Brazil’s wholesale central bank digital currency (CBDC), DREX. It recently shared details about its use case to enable delivery versus payment settlement when buying a car. BV Bank is a major provider of car financing in Brazil. When the Banco Central do Brasil explains DREX to the public, it frequently mentions this application.
For the pilot, BV Bank has partnered with Ethereum development house ConsenSys and local tokenization firm Parfin.
People find buying a car nerve wracking. If you sign over the title, what if the payment doesn’t hit your account? That said, in Brazil it’s possible to notarize the transfer change and send an instant Pix payment while someone is present. However, the title change and payment are still independent. With DREX, they can be linked. So someone could escrow the money and as soon as the title transfers, the payment is released, a typical delivery versus payment (DvP) transaction.
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