Banco Central do Brasil has published a report on the first phase of its DREX tokenization pilots. They include a wholesale central bank digital currency (wCBDC) and a ‘retail DREX’, which are tokenized deposits or e-money. The central bank said that “the Pilot proved to be challenging from a technological point of view, and has required more intensive monitoring in the second phase than anticipated.”
This reiterates the issue of blockchain privacy highlighted nine months ago, when the DREX schedule was delayed. The first phase of the pilot was narrow, targeting the issuance of government securities and the use of retail and wholesale DREX, with the wholesale CBDC used for interbank settlement. Phase two, which started in November and is currently in progress, involves more advanced use cases.
After selecting 14 teams at the start of the project and quickly adding two more, last October the central bank invited a new batch participants. But despite reducing applications from 101 proposals to 50, it has now decided that it won’t expand the current participant group, because of the need for greater monitoring. In any case, it says the additional suggested use cases weren’t that different from the original batch.
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