coindesk.com
A Brazilian financial-market operator responsible for more than 22 trillion reais of registered assets, roughly $4 trillion, has begun putting records for investment funds run by BTG Pactual, Latin America's largest investment bank, onto the $XRP Ledger.
CSD BR, which operates regulated registration, securities-depository and settlement systems in Brazil, will use the public blockchain as a second record of who owns shares in selected BTG Pactual investment funds, per a release shared with CoinDesk.
A depository keeps the official list of who owns which securities. When an investor buys into a fund, the depository updates its records, while the banks acting for investors keep books of their own and regularly check them against the depository's to make sure the two agree.
That matching work, known as reconciliation, is slow and costly, and a mismatch can hold up a trade.
The existing CSD BR database remains the official record used for registration, custody and settlement, and the assets registered with CSD BR are not being moved onto $XRP Ledger. Fund shares deposited with CSD BR will be represented as tokens on XRPL as well.
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Approved banks and companies can read that blockchain copy directly and check it against CSD BR's database at any moment, instead of comparing their own books after the fact. Every change on $XRP Ledger is publicly recorded, including any reversal CSD BR makes, so a gap between the two records would be visible.
Why use a public blockchain?
Many banks and depositories have experimented with private blockchains open only to invited members. CSD BR is using a public one, while keeping its own controls over who can hold the tokens.
Anyone can read those token movements on $XRP Ledger, but CSD BR still controls who is allowed to own and transfer them.
Those tokens use $XRP Ledger's Multi-Purpose Token standard, designed for financial assets whose issuers need more control than cryptocurrencies such as $XRP provide. CSD BR can restrict who participates and freeze assets or reverse transactions when required by a regulator or court. Participants still have to pass the usual identity and anti-money-laundering checks.
The project starts with live fund records, according to Ripple and CSD BR.
That puts it a step beyond the blockchain pilots banks have run for years using test assets or closed networks. Real fund ownership records are being copied onto the public ledger, even though CSD BR's existing system still has the final legal say.
