According to industry media Ledger Insights on September 18, the Brazilian Securities and Exchange Commission (CVM) is advancing a pilot program using distributed ledger technology (DLT) to test the application of securities tokenization in the capital markets. The program currently only involves simulated trading and does not involve any real securities or real investor funds.

This pilot is coordinated by a dedicated tokenization working group (GTT) established within the CVM, with a testing period set for 60 days, extendable by another 30 days if necessary. A related draft has been submitted and awaits formal approval from the CVM board before implementation can begin.

The GTT was established in July 2026, composed of 14 departments within the CVM, and can consult other government agencies, market associations, self-regulatory organizations, and external experts as needed. The group was initially tasked with submitting a preliminary plan within 60 days of its formal establishment, with an overall review period of 120 days, which can also be extended by 30 days. Its core responsibility is to develop an experimental regulatory framework around the application of DLT in securities registration, custody, trading, and settlement, covering specific topics such as official ownership records on the blockchain, private key custody mechanisms, transaction revocability procedures, and system liability allocation rules.

The announced simulated testing plan covers four types of securities: stocks, bonds, receivables certificates (CR), and investment fund shares, with the testing scope covering most stages of the securities lifecycle, from issuance to settlement. Participants need to assess the technical feasibility, operational feasibility, and legal feasibility of applying DLT in the capital markets, while exploring interoperability between different blockchain networks and identifying gaps in the current regulatory framework.

Before launching this round of the pilot, the CVM had previously conducted a regulatory sandbox experiment based on blockchain for securities issuance and secondary market trading. The newly established GTT will review past pilot results while studying cybersecurity risks and international regulatory experiences. According to previously disclosed data, Brazil’s real-world asset (RWA) tokenization market has reached approximately 12 billion reais (about $2.34 billion), with tokenization of bonds and commercial papers accounting for about $1.3 billion.

From an institutional design perspective, the essence of this pilot is for the regulatory agency to test the impact of new technologies on existing securities registration, custody, trading, and settlement infrastructures in a zero-risk simulated environment before formal legislation. Participants do not need to bear the risks of real funds and real investor rights, allowing for early exposure of potential issues with DLT in inter-agency connections and legal liability determinations. Beneficiaries include technology service providers and financial institutions that wish to engage early in the construction of Brazil’s tokenized securities infrastructure, enabling them to participate in the rule-making process and gain first-mover advantages. If the pilot ultimately promotes formal legislation, traditional intermediary institutions that rely on centralized registration and custody systems may face pressure to redefine their business models.

After the pilot concludes, all participants must submit reports summarizing the final evaluation results, which may further translate into specific regulatory rule revision proposals or even legislative adjustment recommendations.

Source: Public Information