Brazil’s Central Bank Launches XLM-Based CBDC• March 8, 2023 2:04 pm • Comments
It looks like the central bank of Brazil is the latest to launch a CBDC pilot and the name of its CBDC is called the Digital Real.
The pilot CBDC is built on the Stellar blockchain network which makes XLM a top contender to XRP when it comes to crypto that can help facilitate CBDC transactions.
The Brazilian central bank revealed that the aim of this new CBDC pilot is to hopefully replicate a blockchain-based version of Pix which is an instant payment system.
Brazil is not the first country in the world to be experimenting and doing pilots with CBDCs and many other regions in the world have started to look into it with Ripple being the top CBDC solution so far.
If the pilot becomes widely successful, then investors and speculators believe that this will influence the rest of the South American continent to follow suit.
Brazil announces pilot for digital currency seeking to leverage financial services #CBDC #DLT #Stellar #XLM #Fintech #Blockchain https://t.co/HT6eyokarS
— Stellar Network News (XLM) (@Stellar_News_) March 7, 2023
Fabio Araujo, the Brazilian central bank executive coordinating the entire CBDC project expects the public use of Digital Real to happen by the end of 2024. Of course, the adoption shall happen after a successful testing phase as well as after the subsequent evaluation of feedback.
The Brazilian central bank is conducting the pilot test on the Stellar blockchain since it is highly functional and designed for mass enterprise adoption. The tests include Know Your Customer (KYC) verification and anti-fraud procedures, along with traceability and an on-chain decentralized identity process.
Although the Brazilian central bank has chosen the Stellar blockchain for the pilot tests, there’s no surety that they would choose the same blockchain for actual issuance.
The testing phase of Digital Real will include buying and selling federal public bonds among individuals.
Many expect that this move will soon make payments available to many people in the region who do not have access to traditional banking systems.
Blockchain is important in this region because the data shows that roughly 45% of Brazilians actually do not have access to a bank account.
As a result, the creation of a digital Real will certainly disrupt the existing system and provide a huge market that XLM can take advantage of.
If the pilot truly takes off, the amount of CBDC transactions would be high which would grow the Stellar (XLM) ecosystem tremendously.
The fact that this is something that is backed by the country’s central bank also indicates that it will truly reach mass adoption.
The Central Bank of Brazil (BCB) plans to deploy its CBDC on the Stellar public ledger by 2024. Brazil has a population of over 200 million people.$XLM @StellarOrg @MercadoBitcoin @clearsale @BancoCentralBR https://t.co/nEkU2pdbORhttps://t.co/T4RBXT1Bau pic.twitter.com/L2Re5WGXxy
— sammie (@lukinsisammie) March 3, 2023
The launch of the Digital Real on the Stellar blockchain is a significant development for both the blockchain industry and the CBDC space.
It demonstrates that blockchain technology is being recognized as a viable platform for CBDCs and that the Stellar network is considered a highly functional and secure platform for digital currencies.
The launch of Digital Real on the Stellar blockchain also represents a significant development for the country:
Brazil has been working for several years to modernize its payment systems and reduce dependence on cash. The launch of Pix in 2020 was an important step forward, and the pilot testing of Digital Real on the Stellar blockchain should further accelerate this process.
In addition, the release of the coin on the Stellar blockchain should have implications beyond Brazil. The Stellar network is a global platform that can be used by anyone, anywhere in the world.
This means that other countries and central banks could potentially use the Stellar network to issue their own CBDCs.
🚨STELLAR XLM – BRAZIL'S CBDC TO BE DEPLOYED ON STELLAR #STELLAR #XLM #IS… https://t.co/VvWE36136N via @YouTube
— Gil (@MaCamBol719) March 4, 2023
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