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Visa and Microsoft join Brazilian CBDC project
Visa, Microsoft and other companies have joined the Brazil Central Bank Digital Currency (CBDC) pilot program. Banco Central do Brasil plans to introduce a digital real platform in June 2023 and has selected 14 participants from over a hundred institutions that submitted proposals. Participants include Microsoft, Banco Inter and 7COMm, while Visa, Santander, Itaú Unibanco, BTG Pactual and Banco Bradesco have also joined the initiative.
During the initial phase of the CBDC pilot project, the regulator will focus on testing privacy and programmability features. This will be done with a specific use case involving delivery versus payment protocol for federal government securities. The Central Bank of Brazil officially announced a CBDC pilot project in 2022 with the intention of pegging the value of the digital real to fiat currency. CBDC will have a fixed supply and will be minted gradually over time.
Brazil, the largest country in Latin America with a population of 214 million, continues to attract global cryptocurrency companies. In recent months, Binance and Mastercard have jointly launched a prepaid cryptocurrency card here, and Coinbase has partnered with local payment providers to facilitate crypto transactions and enable fiat deposits and withdrawals. In addition, the central bank licensed Latam Gateway, a payment provider for Binance in Brazil, allowing it to operate as a payment institution and e-money issuer.