Brazil-based Investment Bank to Launch its Security Token

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According to a Bloomberg report, Latin America’s biggest investment bank Banco BTG Pactual SA is releasing its blockchain-enabled security token.

The token named ‘ReitBZ’ which will be supported by distressed real estate assets in Brazil will allow the bank to give its real estate business to international investors at lower costs than with traditional means. ReitBZ will be perpetual, with the initial offering period of about 90 days, while proceeds will be reinvested in the distressed portfolio.

Mr. Andre Portilho, BTG’s partner accountable for the project, reportedly said that the bank started exploring the technology behind digital currency several years ago, and stated that “we thought Bitcoin and other currencies were turning too unstable, but we saw an opening with this token to try something new but also with our skin in the game.” The bank expects to raise $15 million through an initial coin offering (ICO).

Investors will be able to purchase ReitBZ via a special platform by using the Gemini Dollar (GUSD) stablecoin or Ethereum. The bank specified that investors will “receive periodical dividends from the recovery of the distressed assets, which will be managed by a BTG-owned firm called Enforce.” The investments will not be hedged.

In Sept. 2018, the biggest brokerage in Brazil, Grupo XP, announced its plans to enter the crypto space by starting an exchange for Bitcoin (BTC) and Ethereum (ETH) named XDEX. Grupo XP CEO Mr. Guilherme Benchimol stated that the company was pushed into the crypto business by the popularity of digital currencies among investors. Three million Brazilians “have exposure” to Bitcoin, compared to just 600,000 that invest in the stock market.

Prior today, Japan’s banking giant Mizuho Financial Group announced that it would start its own stablecoin for payments and remittance services on March 1. A dedicated mobile app will reportedly manage the coin, dubbed J-Coin Pay, using QR codes at checkout to complete retail payments, as well as fixed at 1 yen (~$0.01) per unit.