- Brazil’s central bank has partnered with Chainlink, Microsoft, and Banco Inter for a new trade finance pilot using its digital currency, Drex.
- The project will automate cross-border agricultural commodity transactions, showcasing the potential of blockchain technology to improve global trade efficiency.
What happened
Brazil’s central bank is advancing its digital currency project, Drex, with a new trade finance pilot led by a consortium of major tech and financial players. The initiative includes Banco Inter, Microsoft Brazil, 7COMm, and blockchain firm Chainlink, which will demonstrate how blockchain technology can streamline cross-border trade.
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The pilot focuses on automating the settlement of agricultural commodity transactions across multiple platforms and currencies. Central to the project is Chainlink’s Cross-Chain Interoperability Protocol (CCIP), which will enable seamless transactions between Brazil’s Drex platform and foreign central banks. This effort will also tokenize an electronic bill of lading (eBoL), ensuring payments are triggered as goods move through the shipping process, reducing inefficiencies in the global supply chain.
Why this is important
This initiative aims to revolutionise trade finance by integrating blockchain solutions into real-world applications. For Brazil, the pilot signals a significant step forward in leveraging central bank digital currency (CBDC) technology to improve the efficiency and transparency of international commerce.
By introducing automated processes and interoperability, the Drex trade finance pilot tackles longstanding trade inefficiencies such as delays, lack of transparency, and reliance on intermediaries. Beyond immediate benefits for Brazil’s economy, this project sets the stage for broader adoption of blockchain in global trade, potentially influencing how other nations develop their own CBDC-based solutions.
