Today BTG Pactual, one of South America’s largest investment banks, announced the launch of BTG Dol, a dollar-backed stablecoin. The crypto asset is offered as part of the bank’s Mynt crypto platform and is portrayed as providing investors the opportunity to ‘dollarize’ part of their portfolio.
“Once again, we are innovating in using financial technology in our clients’ benefit. When buying BTG Dol, investors have access to an easier, safer and smarter way to invest in dollars,” said André Portilho, Head of Digital Assets at BTG Pactual.
The bank says it provides custody for the tokens and backing assets, manages the backing assets and looks after compliance processes such as anti money laundering (AML).
From an investment banking perspective, this makes quite a bit of sense. Stablecoins don’t offer the token holders any return, but if the bank invests the backing assets in short term U.S. Treasuries, the yield is currently 4.64% which goes to the bank.
When asked for the nature of the stablecoin backing assets. A spokesperson responded, “BTG Dol is 100% backed by US Dollars and low risk, highly liquid USD assets held in segregated accounts.” The tokens are issued on the Polygon blockchain. BTG Pactual launched its Mynt retail crypto investment platform in 2021.
Meanwhile, Brazil’s central bank is not looking to issue a retail central bank digital currency (CBDC). It recently launched its digital real pilot involving a wholesale CBDC with corporate and consumer interfaces via bank deposit tokens. The aim is to provide a settlement asset for tokenized securities because retail payments are well satisfied by the Pix mobile payment application.
Update: added details re stablecoin backing, custody, and the issuance blockchain