 In my talk today I'm actually going to present you a very specific pilot that we just recently finished and you can find more information online just to kind of really focus on the use case of how we're thinking about this whole space around digital currencies in general. But before diving in I do want to spend a little bit just on you know what is Visa, what is Visa Crypto, what are we doing. So as you guys know you know Visa is really in these kind of hard of infrastructure connecting between all the different payment flows so essentially we're payment enabler, we work with banks, with institutions, with fintechs, digital partners and stuff like that to really just being the flow of money movement. And so as we're thinking about crypto in general one of the natural questions to us is you know what is that future of money is going to look like right. You know people started thinking about stablecoins back in the early 2010s and then with central banks coming in you're looking at central bank digital currencies probably a lot of them are being compelled by the fact that Libra and other projects came along and this is really how the beginning of CBDC came about and of course as Daniela and Sophia mentioned earlier we're seeing this increasing very strong momentum around tokenization of everything starting with cash, starting with the tokenization of deposits as well as tokenization of assets. So in this presentation I want to walk you through a very specific use case that we did around CBDC tying the CBDC of the specific use cases what it can enable but really in the context of tokenization and how we're thinking about it. I do want to leave some time for questions and stuff we'll see. So just and I don't have a lot of slides by the way so hopefully should be pretty succinct. So I said all of these are already being published on the official central bank of Brazil's website under the lift challenge. Just a little bit background about what is the lift challenge. So they initiated this kind of opportunity at the end of 2021 they're very futuristic in terms of how they're thinking about it specifically there's two sides of what they really want to understand more and hence having this very kind of interaction with the private sector. So what they're looking for one is what is that role of CBDC is going to fulfill? How is that going to be compatible with all of the existing payment rails? This is a very important aspect there's no point of just rewriting the history and just rebuild a whole new set of rails to compete out the existing things. So number one thing is that compatibility and therefore the interoperability with all of the existing rails. So they want to demonstrate how CBDC could look like in that context. Secondly what are the net new use cases and utilities a central bank currency can bring to the country to which all of the existing ecosystem is not enough to deliver that. So wanting to be very futuristic and specifically I think I mean I can't remember but they have a set of requirements some of the things are for example deliver versus payment, payment versus payment, offline capabilities and interoperability with everything else and actually one section as well on the area around DeFi. So that is the context of the central bank of Brazil as they kicked off that project and for us you know we you know my team we spend a lot of time with central banks right my team is around CBDC so one of the first thing we want to understand is what are the set of specific requirements of objectives for different central banks and then trying to figure out what the role that visa can bring and also technology infrastructure we can help to demonstrate what is the art of the possible. So this is how we started. So thinking about Brazil this is where we started to really try to identify persona and specific use cases that will be relevant for Brazilian economy. This is how we came ultimately to this persona of looking at a local SME which is in the agribusiness and trying to build a set of infrastructures that would enable that would enable programmable finance to be built for the future. So again treating this pilot or this POC as very futuristic looking but we want to show what could be value added to the whole ecosystem as we're building out all these different infrastructures. So that we coined the term programmable finance of course being inspired by what's happening on DeFi but here we're really looking at you know those that would be relevant for the B2B use cases as well as in a contact that's more regulated and with compliance and everything involved. So what are we trying to show and this is I'm just going to read out a little bit but at least like I'll explain. So the programmable finance platform that we have enabled is to provide greater market access and that's a really key thing because if you think about in today's world financing exists for all these agribusiness and other type of local SMEs but the financing terms are pretty bad because the amount of market access for a lot of these local SMEs are pretty restricted. As a local farmer I probably face a few global conglomerates in which I can get financing and what kind of financing are we looking at you know if you think about yourself being a farmer there's a lot of uncertainties in the world right your crop is not going to get delivered until six months eight months down the road but you do need the money today in order to pay for your employee like plant or the seeds do a lot of the fertilization etc so that gap in terms of finding the right financing term and who has the capital to provide that in today's world the market infrastructure itself is very limited for these local SMEs and so let's think about blockchain right this is where we're thinking well if blockchain could really enable and open up that market access for someone like a local agriculture business so that they can face a global pool of investors who are happy to bid on that piece of financing now the story gets a lot more interesting but also for the global pool of investors think about the fact that I myself I cannot if I want to have exposure to soybean right today I cannot just do that because I don't even know where to go and how would I do that but instead like if you're thinking about having a marketplace down the road in the future that you could enable this two-sided markets it becomes a really interesting thing and I want to kind of really emphasize on the use case less about the infrastructure itself because here I'm not saying that blockchain is the only solution that can solve for it but certainly blockchain demonstrate it is possible because things like smart contract like programmability that we have showcased throughout the whole exercise demonstrate what is I said the art of the possible so I said one of the main thing that we want to really enable is around this market access to have greater market access introduce more competition into them into the market and I guess ultimately you can have more better efficient price discovery process in better into that we're also throughout this whole platform demonstrated you know how do you facilitate interoperability between a CBDC to a stable coin in the future it could be a tokenized deposit with a CBDC or you know CBDC between CBDCs the the heart of the infrastructure that we have created actually it's on the right hand side is called a universal payments channel that's the piece of infrastructure that we build out that could enable all these kind of interoperability between different form factors of digital currencies and then we are we showcase how like a CBDC platform that is using actually Hyperledger Bezu to build out the foundational infrastructure set could be integrated back with the PICS system as well with the help of our partner Sinkia and Microsoft in this process and ultimately we want to really focus on the real world applications with that but you know as I'm describing this infrastructure and the market marketplace and stuff like that what does that process look like that process then takes us to what I'm talking about on tokenization in a sense the challenge today is just you know depends on the industry you're looking at you need different processes to bring something that exists off-chain in the real world today bring on chain you know it's an oracle question or problem if you will but it's a matter of what does that process look like how many steps who are the right regulated entities and others and partners that might be involved to bring what already exists off-chain to on chain and how do you package that around to change it into some other form of financial derivative or financial asset classes directly on on chain and what kind of future new flows you may be able to drive so that's kind of a set of I guess use case and how we're thinking about to enable so the partners that we work with include Microsoft, Sinkia, AgriToken in which we learned a lot from the expertise of creating the tokenization process understanding what is very specific to the LAC market and I said you know this entire infrastructure started with using Hyperledger Beizu because you know we want to be very close to the EVM compatibility part right we want to really use the smart contract capabilities to demonstrate all of that and hence that's the reason why we chose the Beizu platform to do so one sec so yeah so there you have it so on in a nutshell you know SME soybean farmer is looking to do three things and this is what we demonstrated through our experimentation so basically you know as a local SME the first thing he wanted to do he what she want to do is basically tokenize that piece of existing corporativa contract into a verifiable NFT and I do want to kind of like just mention it's really interesting right because in today's world that piece of corporativa contract is literally just a piece of physical paper with a stamp and you need to make sure that for example someone need to verify the legitimacy of that and also that you do not upload this contract into different parts of the you know different digital market platforms because then you have the double counting error that's embedded to it so it requires a very kind of like I guess controlled environment to make sure that this happens and you need to develop a process related to it ultimately what we're trying to do is tokenize that piece of physical financial contract on chain and change it into an NFT right this is in which you're not no longer looking at NFT just for like arts work or whatever this piece of NFT represents your invoice so this is what we are looking at is really the the factoring market in in the in the finance and capital market and so traditionally as you're doing factoring how do you do that on chain so replicating that on chain by creating this piece of verifiable NFT and as we're building that we also thought about okay what about sustainability right can we add additional sort of markers or additional sort of information to this piece of NFT and the answer is yes because you can keep on adding a lot of extra metadata to as you are uploading this as long as you know you have the right attestation process to make sure that it's all been checked and compliant to the regulation so that's step number one around tokenization the second piece is the super interesting one so it's about auction the NFT to global investors to finance his harvest and I think later slide we show a little bit more detail of that infrastructure that we build but what I would encourage is first what we leverage is visas in-house technology of what we call universal payment channels so it's really leveraging payment channels to enable interoperability and then on top of that we build an on-chain first-price seal bit auction mechanism directly on that so what that means is basically me as the farmer I load you know imagine I have a front-end app right which is the marketplace I'll upload that piece of NFT what I need to specify for that is I want to put it for auction I specify an expiration date of say okay this auction mark is only valid for say the next five days I then specify what's the minimum the floor price that I would be willing to accept I put it out there everything is completely automated as soon as you upload that you can imagine the global point of investors if they receive that data they can start engaging that competitive bidding process I guess a similar thing you can relate to is how you might potentially do it on the open sea some if some of you have bought NFT before it's you know we're taking inspiration from that but here is looking at very much a B2B use case so once the auction is done then you have a set of things which is payment versus payment deliver versus payment transactions going to take place I don't want to go into the detail but this is exactly where we use smart contract to showcase how you can do everything atomically so what I mean by atomicity atomicity basically says if one leg of that transaction fails every single leg of the transaction will not go through what's the benefit of that it means that in the future if you do atomic settlement you remove counterparty risk altogether right because if you think about it in today's world things take t plus two days to settle or even longer to settle in between that time like you might imagine another bank like SVB go out right you do face that counterparty risk now on the smart contract as we're leveraging programmability that's exactly one of the key things that central bank is really keen to explore around this notion of atomicity in eliminating risk in the marketplace and really trying to protect both I guess the center and recipient front of the fund flows so this is what we demonstrated and then the last piece is paying the employees offline I would highlight you know we also launched a set of research into offline payments back in 2020 it's really a piece of research but we're happy to share these information but I do see that in the world of CBDC there's a strong demand by central banks as they're looking at what does this feature of CBDC could look like some central banks very much focus on this notion of a digital version of cash in the sense it can be offline you know imagine if you're in a remote region whether you're skiing whether you're in like a really remote region trying to pay your employee you can't count on the fact that you have internet but can I still transact in a digital way the answer is yes and this version to create offline payments so countries I guess in a lot of the emerging markets but also countries that have prone to natural disaster like Japan right they're actually very much into these kind of offline payments and from the visa perspective I think we're keen to promote more research because our visa research team has been heavily involved in a lot of the development and you know would be happy to push for more standardization around this industry to see how it evolves I just want to give you a view of what that digital marketplace looks like it's really just generic but you can imagine this is the front end facing in which you know as a local SME having like an app with its existing existing bank you know maybe one day he can receive a notification that says okay let me create my business CBDC account right I can convert some of my existing money my savings account whatever into that one and by the way I said in the future this could easily be replaced rather than a CBDC a retail CBDC can be replaced by a bank's tokenized deposits or stable coin equivalent as you like and then the next phase is really about the NFT creation as you can see that is about how I can upload the piece of well we have more flows and there's a YouTube recording of that if you want to go into that and I'm happy to share the link so there's going to be a whole flow around NFT creation to show you the process of that oracle process of bringing something off-chain to on-chain and lastly it's about paying paying your employee offline and actually sorry I just realized all of these are video links but I think it's a PDF format so unfortunately I can't show you that but let me go in a little bit into the technical design aspect and I think I kind of mentioned that in around but you know just to keep track because it is a pretty complicated flow right we are trying to really demonstrate a persona and use and to enter flow to really describe where does the CBDC comes in how to leverage smart contract programmability and fundamentally what does that programmable finance represents so breaking those down into three different kind of components of what we have built directly and or with partners so number one is around this notion of a digital currency payments infrastructure and crucially as said within this we heavily leverage visa solution which is the visas universal payment channels to enable interoperability for the payment versus payment but also building that on-chain auction mechanism directly using the payment channels the benefit of that is that you can run this thing automatically the auction mechanism automatically and once the bidding is completed and you find who's the highest bidder you can then transact that piece of NFT with the money so this is the delivery versus payment flow that we have demonstrated and then the second process is around this notion of asset tokenization as said we demonstrated that flow step by step with the advice of our partner AgriToken in this process to really understand and demonstrate how as a local SME business owner you can upload your physical piece of CPR on-chain through the set of process that is involved and then the last piece is really like having the compliance in mind and really think about identity this is where we leveraged our partners Microsoft and Sinkia's digital identity solutions to do with DDIs as well as verifiable credentials to demonstrate that aspect so just to kind of finish off therefore of what we have accomplished for the BCBs and I think you know like as Daniela said in the introduction Brazil is probably one of the most advanced countries in terms of exploring the potential of a CBDC the very forward-looking and we've spent like a decent I think almost a year working with them through this project so it's very nice to have the insight view of understanding how they're thinking about it I think in general there's just a lot of innovations that as the private sector we need to actively really explore but the key always goes back to what is the exact use case we're looking at and specifically what kind of pain points that we're trying to address that's that's I think ultimately it's going to be very important to really figure out how is your go-to-market solution is going to look like so what we accomplished during this lift challenge is really fourfold first number one promoting competition and capital efficiency as I spent quite a bit of time at the beginning you know the the whole thing is about opening up market access for both sides for both the local SMEs but also for the fact that in the future global investors have better access directly into local markets into different asset classes that they want to have exposure to and I do think this is one of the main drive for tokenization in general right as we're bringing all of these real-world assets on chain fractionize it or like bring more liquidities use it for other collateral management etc it's all about market access the second thing that we have accomplished is really complementing existing payments and crop financing for structure didn't show it in the slide but I said we have some more materials online that demonstrated how we are able to integrate this CBDC system with existing PICS RTP system through Sinkia who is one of the partners that we work with through this process the third one is very important for us which is foster that develop developer-friendly ecosystem which attracts innovation to Brazil and specifically we have made a very deliberate choice to use Hyperledger Beizu for this process because we do want to demonstrate that EVM compatibility and write everything in solidity and to build out the smart contract with the payment channels we wrote in order to demonstrate all these kind of cool novel things like auction market designs and stuff like that and then last but not the least you know support Brazil central banks initiatives of inclusion sustainability open banking and competition and I mean it's really a baby step of what we showed through this project but I do think that as you can bring more different attributes on chain that in the future as you're thinking about sustainability inclusion market access etc there's a whole new scope in which what you can build and enable so yeah we're super excited and we'll keep doing more work in this in this field and that's it thank you everyone I think how long do we have I think we have some time for questions hi very nice presentation just kind of curious about the results in terms of you know is this already launched and have the farmers been able to tokenize their their crops yet and you know actually get the global investors to start purchasing or is this something that's going to be launched later sure so this is very much like we build a prototype that's functional in our own environment this is definitely not a product and we don't know yet where this is going because a lot of the components that I show you out there you know it's not assuming that visa will build out these specific components for example the front end the marketplace and we welcome you know the collaboration with other market players to really figure out this holistic ecosystem and I think for us what we want to focus on more is around interoperability for cross-border payments etc you know I said between CBDC stablecoin CBDC tokenize deposit etc and how do you do it to enable seamless cross-border flows those are the things that we want to help to enable for our partners and stuff so thank you