Innovation is a gamble that requires resilience and patience, after all, Although a universe of possibilities is glimpsed, there are limitations and barriers that can only be overcome with the maturation of the market itself.
Blockchain technology is an example of this. Despite all the value proposition and usability prospects of the chain in different approaches, for some time it was seen as a passing fad or a bubble removed from reality by the vast majority of people.
For Diego Pérez, general director of SMU Investimentos, nowadays, as the infrastructure develops real applications, companies, traditional financial institutions and the regulatory entities themselves begin to implement integration actions, as is the case of Real Digital and asset tokenization projects of the CVM (Securities Commission).
Recently, the Central Bank of Brazil announced new guidelines to digitize the country’s currency, presenting a settlement infrastructure for a tokenized Real on the blockchain.
For him “RD Pilot“, as it is called, the regulator opted for the use of the Hyperledger Besu platform, compatible with EVM (acronym for Ethereum virtual machine) on a licensed network, which are private networks controlled by a single entity, facilitating compliance with existing financial laws and regulations.
Initially, the transactions will be simulated, that is, without dealing with real operations or values.. During the testing phase, the benefits of the programmability offered by the platform for operations with tokenized assets will be evaluated.
And this is far from the only cryptoeconomic initiative promoted by official entities. In 2022, the long-awaited Guidance Opinion 40 came to light, which consolidated the CVM’s understanding of the rules applicable to crypto assets that are considered securities.
The Regulatory Sandbox was also created by the regulator, an experimental environment that aims to temporarily suspend the obligation to comply with the standards required to operate in certain sectors.
“Both are important milestones for the integration of this market into the Brazilian financial system as a whole.“, emphasizes Perez.
Of the four projects approved to operate with flexible rules in the environment controlled by the regulator, three involve the issuance, public distribution, and trading of securities issued or represented in the form of tokens on blockchain networks organized on an over-the-counter basis. The projects include offers from CVM Instructions 467, 461 and Nova 135, related to debentures and shares of closed-end funds, and CVM 88, referring to securities of startups and scale ups with revenues greater than R$80 million.
Diego affirms that the main challenge that these initiatives propose to face is liquidity. And he highlights that tokenized assets can help solve this problem effectively for several reasons:
- global access– The digital nature of tokenized assets allows them to be traded globally through multiple trading platforms. This increases the number of potential buyers and sellers;
- Greater transparency– Blockchain technology is transparent and immutable, which means that all transactions are publicly recorded and cannot be changed. This increases investor confidence in the asset and may lead to increased trading volume;
- ease of division– tokens can be split, allowing investors to buy and sell smaller amounts of an asset;
- Automation– Trading of tokenized assets can be automated through smart contracts, where platforms automatically execute trades when certain conditions are met. This can increase the speed and efficiency of negotiations.
Given the innovation scenario, the Central Bank is promoting more initiatives that bring applications of these technologies. To evaluate the use cases of Real Digital, as well as its technological feasibility, the LIFT Challenge was launched, a special edition of the Laboratory of Financial and Technological Innovations (LIFT). Projects focused on the settlement of transactions with digital assets, both native to the digital environment and tokenized, currencies, the Internet of Things and decentralized finance (DeFi) will be selected.
“We are taking the first step towards a profound change in the architecture of the financial system. Tokenization proposes a new market dynamic, with positive impacts on the entire economy“, expresses Diego, and concludes by saying:”Perhaps investments in Bitcoin, NFTs and other alternative assets will continue to be relegated to the enthusiasts’ community, however, we already have a consensus that Blockchain is not a passing fad and is getting closer to the reality of most people“.
Disclaimer: The information and/or opinions expressed in this article do not necessarily represent the views or editorial line of Cointelegraph. The information presented here should not be taken as financial advice or investment recommendation. All investment and commercial movement involve risks and it is the responsibility of each person to do their due research before making an investment decision.
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