Brazil’s biggest crypto exchange platforms Mercado Bitcoin, Foxbit and Bitso have teamed up to launch BRL1, the first stablecoin pegged to the value of Brazilian Real.
According to Brazilian media outlet Valor on Oct. 8, Mercado Bitcoin, Foxbit and Bitso will launch a stablecoin pegged to the Brazilian Real, naming it BRL1. The Brazil stablecoin set to release later this year will be issued on Ethereum and Polygon.
Digital bank Cainvest said it is gearing up to provide liquidity for the stablecoin’s Bitcoin(BTC) and Ethereum(ETH) trading pairs listed on these exchanges and other markets to be developed in the future.
The Brazilian stablecoin is designed to accommodate transactions made between local exchanges, facilitating cryptocurrency purchases and sales without using fiat-based rails.
Business director at Mercado Bitcoin, Fabricio Tota, said that the goal behind creating BRL1 is to bridge the gap between traditional banking institutions and the crypto industry. He hopes that BRL1 will be able to smoothen out the “friction between the traditional financial system and the crypto world”.
“And when you introduce a real cryptocurrency, with the support of major players in this market, I think we are taking a few steps forward, we have a good chance of reaching this common user,” said Tota to Valor.
As explained by the three crypto exchanges, BRL1’s value will be pegged to the Brazilian Real, which means 1 BRL1 token will be equal to R$1. The reserves will be backed and composed by the country’s National Treasury bonds.
President of Cainvest, Charles Aboulafia, emphasizes that the token’s reserves will be audited and disclosed with full transparency to its users.
The new crypto asset will be available on exchanges later this year, with an initial supply equal to R$10 million held by MBPay and Nvio, payment institutions of MB and Bitso, and regulated by the Central Bank of Brazil.
The crypto exchange representatives expect the stablecoin to reach a total trading volume of 100 million BRL1 issued in one year.
