Brazil’s financial regulators launched an information-sharing blockchain platform called PIER on Wednesday.  

At launch, the blockchain pulls data from three of Brazil’s four major financial institutions: the private insurance superintendent (SUSEP), the Banco Central do Brasil (BCB) and securities regulator (CVM), PIER’s main backers. Social security supervisor PREVIC also plans to join.

Once it does, PIER will unite Brazil’s entire financial oversight ecosystem in what CVM called “a vast integrated database” that accelerates the speed with which each can administer its slice of Brazil’s $1.9 trillion economy – Latin America’s largest by far.

One use of the platform would be to conduct background checks on political appointees, according to BCB.

“Our objective is that this system promotes gains to the market, given the more efficient, safe and adequate supervision and enforcement to the new technological scenario that we are experiencing” said CVM President Marcelo Barbosa in a press release.

PIER grants bureaucrats access to their sister agencies’ real-time records on company sanctions, financial performance and business associates “in seconds,” according to BCB. It’s an easy, online bridge between previously siloed data troves.

“This makes it possible to drastically reduce the time period for assessing requirements,” said Daniel Bichuette, deputy head of the BCB’s Financial System Organization Department, in the press release. 

Each agency envisions using PIER to improve their oversight efficiency. For example, BCB said in a press release that PIER can streamline its vetting of elected officials appointed to financial institution posts – specifically the examination of their qualifications and business reputation. The central bank is charged with conducting such investigations.

CVM, for its part, said PIER can boost corporate investigations. 

The project is expected to reduce the time it takes to conduct cross-regulator investigations as well as the cost. CVM did not immediately respond to requests for hard numbers. 

It’s also being seen as a more secure means of storing information. 

“Building PIER, using blockchain, allows the use of decentralized, tested technology whose native functionalities mean that there is no need to build the system from scratch,” BCB software manager Eduardo Weller said in the press release.

Based on BCB’s description of PIER, the underlying blockchain appears to utilize a consensus-based mechanism with multiple nodes and a digital signature system. BCB did not immediately respond to requests for a deeper technical overview. 

BCB will add yet more government databases to PIER over time, saying the system “has the potential to aggregate databases from outside the financial system,” the press release said. Possible additions include data from: “judiciary, trade boards and international financial stability bodies.”

PIER’s debut is two years in the making. BCB, which first developed PIER and now administers it, disclosed PIER’s existence in June 2018. Project lead Gabriela Ruberg did not respond to a request for comment.

Brazil’s financial sector often looks to blockchain’s potential. Private banks have issued security tokens on the Tezos blockchain and minted Brazilian real-backed stablecoins on Ethereum. As the PIER press release notes: “The use of Blockchain in financial services has been growing in the market.”

The regulators, and especially BCB, have been similarly bullish. The four now running PIER launched a blockchain sandbox in June 2019.

This embrace of blockchain’s technological potential comes in striking contrast to its wider views on cryptocurrency. BCB officials have likened bitcoin to a pyramid scheme. Even so, they have stressed that the tech is different from its individual applications.