Santander bank trials blockchain platform for used cars in Brazil

Major global bank Santander continues to explore the benefits of blockchain technology, with a local branch implementing blockchain for vehicle trading and car registration.

Santander Brasil has launched testing of a blockchain-based tokenization platform for the transfer of ownership of used cars in Brazil, Cointelegraph Brazil reported on 19 Oct.

The platform is designed to automate the process of transferring property registration by implementing smart contracts based on a delivery against payment (DVP), a settlement method that guarantees the transfer of ownership after successful payment.

Santander’s latest solution for vehicle registration has been developed in collaboration with Parfin, a major provider of digital repository and Web3 infrastructure in Latin America.

According to Parfin’s co-founder and chief technology officer Alex Buelau, the platform will be based on a proprietary blockchain network developed from the Ethereum blockchain. However, unlike Ethereum, the system’s blockchain will be permissioned or private, meaning it will not be publicly accessible.

Santander’s project is part of initiatives selected by Brazil’s central bank’s Financial Innovations Laboratory (Lift). The Lift acts as a project incubator, with one of the goals of using the digital real, or Brazil’s digital central bank currency, which is reportedly planned to launch in 2024. Meanwhile, Santander has already presented its demo platform to the central bank, aiming to test real transactions that involving in the near future.

Jayme Chataque, open finance superintendent at Santander, suggested that the same technology could be used to sell and register properties. “It has both convenience and security benefits for both buyer and seller. You’re turning two transactions into one,” he noted.

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Buelau reportedly pointed out that regulation is one of the few major challenges on the road to mass adoption of blockchain technology, saying:

“Technology moves faster than regulation. […] The challenge lies in regulation. But Brazil is ahead in that sense, the authorities are bold, so we can have this sooner than we thought.

Santander Brasil is the Brazilian unit of Spain’s largest commercial bank, Banco Santander. The local bank is known for its crypto-friendly stance, with CEO Mario Leao reportedly announcing Santander Brasil’s plans to launch crypto trading earlier this year.

Global bank Santander has also been actively experimenting with blockchain technology, partnering with agri-commodity tokenization infrastructure and issuing blockchain-based bonds. The bank is also known for its close cooperation with the major crypto firm Ripple.