How blockchain technology can unlock new business models

The integration of "real" and "digital" world assets through blockchain technology has the potential to reshape the financial market as we know it.

Payments and transfers are two applications that can be optimised through smart contracts, a technology of the Ethereum network. In addition to reducing transaction time and costs, this innovation creates opportunities for financial institutions to introduce a range of new services for clients.

Capital markets are also expected to be transformed. Through smart contracts, any financial asset can be tokenised. There are initiatives in test environments that tokenise fixed-income securities, gold, silver, oil, stocks, investment fund shares, and real estate assets - among others.

“Society is gradually learning about the benefits of this technology. On the other hand, financial institutions have been promoting projects and are waiting for clear regulations to start offering services to clients,”
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Carlos Henrique Lopes, CDO at Parfin

Drex

In Brazil, the digital asset market has the potential to develop rapidly with the implementation of Drex - Real Digital. The expectation is that the first tests will start running between the end of 2024 and the first quarter of 2025.

By combining the digitisation of money and the tokenisation of assets, Drex is expected to increase the security and optimize the efficiency of the national financial system. The new dynamics will allow the market to operate 24/7 and have specific automations for different segments.

"The Real Digital and the CBDCs (central bank digital currencies) are redefining the game, ushering in a new era of opportunities and technological advancements. As leaders in our industry, we are committed to being at the forefront of this revolution, directing our efforts to offer innovative, secure, and reliable solutions,"

Marcos Viriato, CEO and co-founder of Parfin.

Regulation

The lack of specific regulation for the sector is one of the main factors holding back this technology from spreading globally. Although 24 countries - such as Portugal, Spain, and Japan - already have rules that cover the usage and transfer of digital assets and stablecoins, many nations, such as the United States, do not yet have a legal framework to provide legal certainty for companies to develop new initiatives.

“During this phase of legislation development, tokenisation initiatives, for instance, happen in controlled environments with regulatory waivers. This is a way for regulators to understand the possibilities of this technology, including from a regulatory compliance perspective,” says Beatriz Fernandes, COO at Parfin.

In Brazil, we have the Lei de Criptos (Crypto Law, 14.478/22), which designates the Central Bank as the regulator. Currently, the monetary authority is following the official procedures to formulate and present the rules.

In the United States, while Congress is slowly discussing legislation on stablecoins, the SEC is promoting some advancements in the market, such as the approval of the first Bitcoin Spot ETF announced in January of this year.

Europe has already taken an important step in regulating the sector with the enactment, last year, of MiCa, a legal framework for crypto assets effective in the member states of the European Union. The new rules will start to come into force in June, and the expectation is that legal certainty there will contribute to raising the global digital asset market.

The possibilities for new blockchain applications are endless. If you want to be at the forefront of this technology and offer cryptocurrency and tokenisation services, Parfin is your partner!