Hi friends. I am doing some research on Real World Assets (RWAs). In your opinion, what type of RWA would be more interesting for DeFi investors and for DAOs or individuals treasuries to invest?
Brazil is walking torwards regulatory clarity regarding RWAs: https://lopesezorzo.com/
In the spirit of cooperation I would like to share with you a few resources regarding the convergence of TradFi and crypto which I am seeing in Brazil.
I think Brazil is progressing steadily in regards to creating regulatory clarity for the tokenization of its economy. This is a very interesting book about this topic: https://lopesezorzo.com/
I was watching Nadiem´s talk on StableSummit. In particular, the slide below:
It mentions the emergence of “Decentralized Intermediaries” that bridges the gap between On Chain and Real World systems. In my opinion, that is the path that Brazil´s legislation is progressing towards with the creation of “Instituições Gestoras de Garantias”, as mentioned in the PL 41888/21 .
Brazil is already in its Pilot phase with its CBDC, and they are now calling DREX. As seen in this talk by Aristides, one of the technical responsibles for the DREX project. In the talk he mentions that the 3 biggest technical challenges that the project still needs to overcome are: (1) Privacy of transactions, (2) Scalability of the network and (3) Interoperability with other blockchains. I recently learned that they are going to create working groups with key people around those areas. I am a candidate for joining the Interoperability working Group, as I want to pursue my PHD in the topic of “interoperability on DREX”. And I am going to advocate for DREX to allow the interoperability with public chains, like Celo.
Coming back to the topic of Real World Assets, there are startups in Brazil already working as these “Decentralized Intermediaries” mentioned in Nadiem´s slides. One such example is AmFi, that tokenizes short term debt of companies. But the hook between the fiat system (PIX payments) and the tokenized RWA is not inextricable yet. I think there are still some missing pieces of the puzzle.
One missing piece is a strong On Chain identity for public blockchains that would allow the trade of the tokenized RWA only among people who have been KYCed and authorized by the Decentralized Intermediary .
Another missing piece is the interoperability protocol that will allow for the “mirrowing” of the trade activity in the public blockchain with the DREX chain and/or the Decentralized Intermediary records. After all, the Decentralized Intermediary entity is going to be liable for anything that happens with the tokenized RWA.
- So, at least in Brazil, the legislation and the TradFi infrastructure is progressing towards a world that might allow near real time settlement between public chains and the TradFi world. Brazil might be the first country in the western hemisphere to arrive there! I am going to be an advocate for it with the guys at Brazil´s Central Bank, for sure.
Hey friends. One interesting development regarding RWAs in Brazil. Brazil´s SEC, the CVM is going to create another regulatory sandbox next year: CVM avança em tokenização e planeja novo sandbox para 2024