Fabio Araujo, Digital Real project coordinator at the Central Bank of Brazil, and Aristides Cavalcante, deputy head of technology and information, said the acronym DREX stands for elements of innovation: D stands for digital, R for real, E for electronic, and X is related to transactions on the Brazilian platform Pix.
The platform provides instant and free money transfers using QR codes, phone numbers and email addresses, instead of long bank account numbers.
Araujo said the digital real will make it easier for ordinary citizens to get credit or insurance, and make investments more accessible to them. The digital real will make banking more accessible to people.
DREX will also be used to trade government bonds, Araujo said. Maria Rita Serrano, president of Brazil’s largest state-owned bank Caixa Econômica Federal, added that government and labor benefits could be paid in digital reals in the future.
Brazil’s Central Bank recently released the code for a digital real pilot project. A number of settings were found in its smart contract that allowed users’ accounts to be frozen, their balances reduced, confiscated and new coins created.
In June, Brazil’s central bank formed a consortium to test the digital real, which includes Mercado Bitcoin, MasterCard, Genial, Cerc and financial software developer Sinqia.