Nubank (NYSE:NU), which claims to be one of the largest digital financial services platforms in the world, announces the start of practical tests as part of its integration into the pilot project of Drex, the Brazilian digital currency formerly known as Real Digital.
The start of simulations is “made possible by connecting the company’s infrastructure to the Drex blockchain network, which operates on the Hyperledger Besu technology, chosen by the Brazilian Central Bank for transactions.”
The digital version of Real will be “an important step for other types of assets, such as automobiles, to have a digital representation on the Drex platform, which will reduce trading risks and operational costs, as well as simplify the process.”
Thomaz Fortes, general manager of Nubank Cripto’s operations, said:
“Nubank is a blockchain technology enthusiast, and we believe that the success of Drex has the enormous potential to make our customers’ financial operations simpler, safer, and more efficient. The capacity for innovation and evolution of day-to-day operations, such as the transfer of ownership of physical assets, is immense.”
Nubank is reportedly one of the 16 financial institutions “chosen by the Brazilian Central Bank to participate in the pilot project of Drex, with testing expected to be completed by the end of 2024.”
With the integration of its technological node into the network of the Brazilian Central Bank, Nubank can now “test and simulate transactions with different tokenized financial assets that are part of the pilot, as well as contribute to the development of solutions to ensure the privacy and security of the network.”
In another update, it was noted that Nubank announced plans in September 2022 “to restructure its Brazilian Depositary Receipt (BDR) program in Brazil to pursue increased efficiency and continue to build long-term value for investors and customers.”
The BDR program was “launched during Nubank’s IPO in late 2021 to allow Brazilians to become company investors within the local market.”
It also enabled the “creation of NuSócios, a financial inclusion initiative by which Nubank granted customers a ‘pedacinho’ (one BDR) free of cost and offered a free financial education program, democratizing access to stock market investments in Brazil and fostering financial literacy.”
The BDR restructure plan was designed “to ensure BDRs continue to be listed and traded in the Brazilian Stock Exchange (B3) but change their Level from III to I Unsponsored, which provides cost efficiencies.”
Nubank will continue to be “listed on the NYSE and regulated by the U.S. Securities and Exchange Commission (SEC).”
The plan approved by CVM (the Securities and Exchange Commission of Brazil) in June 2023 granted flexible options “for investors and NuSócios regarding their BDRs by which holders were able to opt within a 30-day period” between the following alternatives:
- receive class A ordinary shares traded at NYSE at a ratio of 6-1 (conditional on having a sufficient number of BDRs and an active brokerage account in the US);
- exchange their current BDR III for an unsponsored BDR I at a 1-1 ratio; or
- sell the shares underlying the BDRs.
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