Ripple Is Helping BCB Build A CBDC Prototype In Brazil – CryptoMode

November 9, 2021 Editor Ripple 0

Central bank digital currencies, or CBDCs, will eventually hit the market, whether one wants it or not. Brazil is one of the many countries where a CBDC can make a significant impact. However, few people realize the country is working with Ripple to build a prototype, even though very few details are public at this time. 

Brazil Is Developing a CBDC

  • Similar to other countries, Brazil wants to explore the concept of a CBDC in the future.
  • Many factors remain unknown, including the deployment, implementation, and even the name.
  • Banco Central do Brasil, the country’s central bank, studies and monitors international efforts and discussions regarding central bank digital currencies.
  • Moreover, the bank leans toward implementing such a currency in Brazil, depending on the findings of a dedicated study group created in August 2020. 
  • Development of a Brazilian CBDC appears underway, and Ripple is involved in the process.
  • No further details on the development are known, other than a prototype being put together behind the scenes.
  • This currency may reside on the XRP Ledger (XRPL), which seems well-suited for central bank digital currencies and other instruments. 
  • Technology-wise, the BCB confirmed it aims to maintain a local system open to adopting international standards to achieve interoperability with other central banks across different jurisdictions. 
  • The BCB and Ripple have met in early 2020 to discuss the development of a CBDC.
  • Other parties, including R3, have eyed Brazil in the past as a region of interest to explore central bank digital currencies. 
  • Ripple maintains an office in Sao Paulo and aims to expand its presence across Latin America. 
  • Ripple’s centralized and permissioned network can be of great value to countries pursuing a central bank digital currency. 

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