Chainlink Thrust it’s Support for Brazil’s Drex Phase2 Trade Finance Pilot
The BCB trade financial pilot won the support of Banco Inter, Microsoft Brazil, 7COMm, and Chainlink looking to progressively develop phase 2 of its pilot project.
Chainlink has thrust its support for the Central Bank of Brazil (BCB) to develop a blockchain-based trade finance solution for the second phase of its DREX digital currency pilot program.
The BCB trade financial pilot won the support of Banco Inter, Microsoft Brazil, 7COMm, and Chainlink looking to progressively develop phase 2 of its pilot project. Notably, the initiative aims to automate supply chain management and improve trade finance processes by leveraging blockchain technology and Chainlink’s Oracle network.
The pilot’s primary objective is to demonstrate the automated cross-border settlement of agricultural commodity transactions across multiple platforms and currencies. However, a key component is Chainlink’s Cross-Chain Interoperability Protocol (CCIP), which will facilitate interoperability between the Brazilian DREX and a foreign central bank’s digital currency, ensuring seamless and efficient transaction settlement.
Chainlink Role in the Pilots’ Development
The pilot will involve the on-chain tokenization of an Electronic Bill of Lading (eBoL), utilizing supply chain data to trigger payments to exporters throughout the shipping process. Additionally, the project will showcase how blockchain-based trade finance enables Delivery versus Payment (DvP) and Payment versus Payment (PvP) mechanisms, enhancing efficiency, security, and transparency in international agricultural commodity trade.
Chainlink CCIP’s role extends beyond this pilot, providing crucial infrastructure for DREX and other central bank digital currencies (CBDCs) and tokenized assets. Furthermore, by enabling smooth token transfers across diverse blockchain networks, CCIP enhances liquidity and expands market reach for enterprises, simplifying the integration of blockchain technology with existing systems.
Angela Walker, Global Head of Banking and Capital Markets at Chainlink Labs emphasized the transformative potential of combining blockchain technology with Chainlink’s CCIP for trade finance, highlighting its role in facilitating secure cross-border, cross-currency, and cross-chain transactions.
Moreover, Banco Inter will spearhead the DREX platform implementation in Brazil. Bruno Grossi, Head of Emerging Technologies at Banco Inter, stated that this collaboration with Microsoft and Chainlink represents a transformative opportunity to expand market reach and strengthen the Brazilian market.
Microsoft, a long-time supporter of blockchain innovation and an early DREX participant, is providing cloud services. João Aragão, innovation specialist for financial services at Microsoft, noted Microsoft’s commitment to developing DREX to expand access to intelligent financial services and contribute to Brazil’s economic growth.
