The Brazilian government is planning to propose the use of blockchain technology for international trade between BRICS countries, according to O Globo.

This initiative is set to be one of the priorities during Brazil’s one-year presidency of the bloc, which began in January.

The idea differs from previous discussions about creating a common BRICS currency. According to sources cited by the publication, the goal is not to compete with the US dollar as the primary global trade currency but rather to enhance the efficiency of cross-border transactions.

This time, the focus is on improving international transactions by leveraging blockchain technology, which enables near-instant settlements and programmability, similar to how cryptocurrencies function. Stablecoins are already widely used unofficially for cross-border payments and remittances, the report noted.

One of the key initiatives for integrating blockchain into the regulated financial system is Drex, a pilot project by the Central Bank of Brazil aimed at developing a tokenized infrastructure for financial transactions. However, the project faces challenges in balancing transaction privacy while maintaining full control by the central authority.

An alternative to blockchain could be the creation of an integrated payment network, similar to Brazil’s Pix system. However, this raises concerns about governance and sovereignty among BRICS member states.

In June 2024, Russia and BRICS central banks began exploring the launch of BRICS Bridge, a platform designed for settlements in national and digital currencies.