SETL announced its selection for participation in the landmark Digital Real Pilot (DRP) project, spearheaded by the Central Bank of Brazil and alongside NUCLEA, Brazil’s key interbank clearing house, and banking leader Banco Bradesco.
DRP will test a Central Bank Digital Currency (CBDC), dubbed DREX by Brazil’s central bank, in a simulated financial environment in Brazil. The first stage intends to issue CBDCs to banks and payment institutions, orchestrate delivery versus payment transactions using smart contracts, and examine the benefits of tokenized assets and e-money held by end clients.
This initial pilot phase will focus on privacy in the exchange of information between the various platform participants, while also testing the programmability of the offered services and their interoperability with the participants platforms.
As part of the consortium, SETL will bring its multi-asset distributed ledger technology (DLT) and regulated liability network (RLN) technology to the table. 36 proposals of interests were received by the Central Bank, representing more than 100 institutions from different financial institutions, of which 14 were accepted to begin the pilot.
Leading the consortium is Banco Bradesco, one of the largest financial institutions in Brazil and Latin America, which brings vast financial market expertise and a broad customer base to the consortium. Also joining is NUCLEA, a vital financial market infrastructure organization in Brazil, which operates as a central securities depository and financial settlement system, facilitating the clearing, settlement, and custody of securities transactions.
Anthony Culligan, CEO of SETL, said in a statement: “We are immensely honoured to collaborate with the Brazilian Central Bank, NUCLEA, and Banco Bradesco in this transformative project. SETL’s rich history of successful collaborations with central banks and Tier 1 institutions globally equips us with invaluable insights to benefit this pilot. As a rapidly developing economy, Brazil stands on the brink of financial innovation that SETL can help drive.”
The pilot project is set to conclude its testing phase by December 2023, with an anticipated launch of a digital currency by the Central Bank of Brazil by the end of 2024. The Digital Real aims to empower customers to transact outside of traditional business hours, paving the way for a wider range of opportunities within the financial system.