Post by account_disabled on Mar 7, 2024 5:13:05 GMT
Drex is based on blockchain technology, issued and guaranteed by the Central Bank, which promises to enable smart contracts — smart contracts built on a blockchain network that enable the automatic execution of agreed terms and conditioned and simultaneous payment. This technological innovation has several characteristics that distinguish it from other cryptocurrencies and that can make it especially relevant for M&A transactions. This is because the blockchain technology underlying Drex offers conditioned and reversible payment issuance, which aims to prevent fraudulent transactions, providing a safer environment and greater traceability of transactions.
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Unlike volatile cryptocurrencies, the value of Drex will remain stable, since this is the Real itself, arranged on a blockchain network. This stability is crucial for its use in business transactions, in which B2B Email List value predictability is essential. Furthermore, access to Drex will not be provided directly to account holders, but rather through virtual wallets linked to payment institutions, such as banks and banking correspondents, in order to guarantee security and adequate regulation during transactions.
In the context of general transactions, Drex presents some opportunities for business development, among which the conditioned and instant issuance and the immutable record of transactions, valuable for auditing purposes, offered by blockchain technology stand out. Initially, Drex will work on the financial settlement of public securities, so its application will be restricted to those operations linked to the public registry.
In the specific context of mergers and acquisitions operations, Drex can be used not only as a means of payment for the acquisition of assets or shares, but also as a form of guarantee, including an escrow account and a form of compensation payment. . However, despite promising applications of Drex, some challenges persist in the scenarios of operations carried out in M&A, mainly when it comes to compliance with conditions precedent or obligations to indemnify, that is, especially with regard to the application of Drex in transactions not linked to public securities .
For example, in the case of obligations to do, provided for in precedent conditions for the purchase and sale of shares, it is undetermined how the process would take place and who would be responsible for checking compliance with this particular obligation so that the financial transaction takes place. . Or, even in an event of compensation, the mechanism for verifying the act that gives rise to the obligation to compensate and, consequently, its implementation based on Drex's conditionality is uncertain.
In other words, given that Drex is a digital currency that enables the automatic execution of agreed terms and conditional and simultaneous payment, in cases not linked to public securities, it is still uncertain who would be responsible and how the indication of compliance or not the conditions for the transaction to occur. But it is possible for the Parties to establish an impartial third party for this role.
In this way, Drex presents significant potential to further automate M&A transactions in Brazil. Its solid foundation in blockchain technology and the benefits associated with smart contract automation promise to improve efficiency, security and transparency in corporate operations, as well as reduce the need for intermediaries and provide operational efficiency.
In parallel, from a long-term vision of the Central Bank, it is possible to identify and resolve challenges with regard to market adaptation and the resolution of outstanding procedural issues related to the functioning of automation and conditionality, characteristics of Drex, and thus ensure an effective transition to the digital era.
reproduction
Unlike volatile cryptocurrencies, the value of Drex will remain stable, since this is the Real itself, arranged on a blockchain network. This stability is crucial for its use in business transactions, in which B2B Email List value predictability is essential. Furthermore, access to Drex will not be provided directly to account holders, but rather through virtual wallets linked to payment institutions, such as banks and banking correspondents, in order to guarantee security and adequate regulation during transactions.
In the context of general transactions, Drex presents some opportunities for business development, among which the conditioned and instant issuance and the immutable record of transactions, valuable for auditing purposes, offered by blockchain technology stand out. Initially, Drex will work on the financial settlement of public securities, so its application will be restricted to those operations linked to the public registry.
In the specific context of mergers and acquisitions operations, Drex can be used not only as a means of payment for the acquisition of assets or shares, but also as a form of guarantee, including an escrow account and a form of compensation payment. . However, despite promising applications of Drex, some challenges persist in the scenarios of operations carried out in M&A, mainly when it comes to compliance with conditions precedent or obligations to indemnify, that is, especially with regard to the application of Drex in transactions not linked to public securities .
For example, in the case of obligations to do, provided for in precedent conditions for the purchase and sale of shares, it is undetermined how the process would take place and who would be responsible for checking compliance with this particular obligation so that the financial transaction takes place. . Or, even in an event of compensation, the mechanism for verifying the act that gives rise to the obligation to compensate and, consequently, its implementation based on Drex's conditionality is uncertain.
In other words, given that Drex is a digital currency that enables the automatic execution of agreed terms and conditional and simultaneous payment, in cases not linked to public securities, it is still uncertain who would be responsible and how the indication of compliance or not the conditions for the transaction to occur. But it is possible for the Parties to establish an impartial third party for this role.
In this way, Drex presents significant potential to further automate M&A transactions in Brazil. Its solid foundation in blockchain technology and the benefits associated with smart contract automation promise to improve efficiency, security and transparency in corporate operations, as well as reduce the need for intermediaries and provide operational efficiency.
In parallel, from a long-term vision of the Central Bank, it is possible to identify and resolve challenges with regard to market adaptation and the resolution of outstanding procedural issues related to the functioning of automation and conditionality, characteristics of Drex, and thus ensure an effective transition to the digital era.