DREX: The BCB says the CBDC will bring ‘more speed, practicality, and lower costs’ to transactions
The central bank digital currency (CBDC) that Brazil’s central bank is to pilot for retail payments in stores is to be called Drex and will be “a step forward in democratizing access for individuals and entrepreneurs to the benefits of the digitalization of the economy”, the Banco Central do Brasil (BCB) has announced.
“Drex will bring more speed, practicality, and lower cost to various contractual and financial transactions we make today,” BCB deputy governor Maurício Moura says.
“In the purchase and sale of a car, the seller often fears transferring the ownership of the vehicle without receiving the money first, whereas the buyer often fears paying before ownership is transferred.
“Due to Drex’s programmability, it doesn’t matter who makes the first move. Only when both conditions happen does Drex conclude the contract by simultaneously transferring money and ownership.
“If one of the parties fails, the car and the amount paid are returned to their respective owners.”
Other potential use cases include property purchases and social benefit payments, Moura adds.
BCB announced in May that it is planning to start testing its CBDC for retail payments in stores.
Brazil’s central bank lays out reasons for developing CBDC was written by Tom Phillips and published by NFCW.