The Brazilian Central Bank has revealed the rationale behind the renaming of the Central Bank Digital Currency (CBDC) from “Digital Real” to “Drex”. The bank elucidated in a statement last week that this new name is an abbreviation for “Digital Real Electronic,” with the letter “X” symbolizing “modernity and connectivity.”

Maurício Moura, Deputy Governor for Institutional Relations, Citizenship, and Conduct Supervision at the Brazilian Central Bank (Direc), articulated that Drex will introduce swiftness, flexibility, and reduced costs to the diverse financial and contractual transactions presently undertaken.

Moura also alluded to how Drex will assist citizens in circumventing challenges encountered in finalizing automobile or real estate transactions, where parties may hesitate to initiate proceedings. He hinted at the integration of Drex with government services to achieve automation through smart contracts.

Drex’s experimental phase is currently underway, with the central bank enlisting 16 entities to partake in this trial, designing applications that could potentially become integral to the final system. According to the Brazilian government-owned news agency Agencia Brasil, the digital real is expected to be accessible to the Brazilian populace by the close of 2024.