BRLV Whitepaper

Last update: March 2026

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1. BRLV: The Story of V in Brazil

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1.1 V’s Role in Breaking Brazil’s Inflationary Spiral

To understand BRLV, it helps to understand the basic history of Brazil’s currency, the Brazilian Real (BRL). In 1994, Brazil launched one of the most ambitious monetary reform experiments in modern economic history. The country had been consumed by inflation for more than a decade. Prices were rising at more than 1,200% annually. Wages were indexed. Contracts were indexed. Everything was indexed — because everyone had stopped trusting the currency as a stable store of value, and the only rational response to that mistrust was to price everything in something other than the currency itself. The cruzeiro real, Brazil’s currency at the time, was technically still legal tender. But in any meaningful sense, it had stopped functioning as money. Across Latin America, the standard response to this kind of monetary crisis was dollarization — either formal, as in Ecuador and El Salvador, or informal, as in much of Argentina and Peru. When your own currency fails, the logic goes, you reach for someone else’s. You give up monetary sovereignty in exchange for stability. Brazil managed to take a different path. Brazil remains, by most measures, the least dollarized major economy in Latin America — a remarkable outcome for a country that spent much of the 1980s and early 1990s in a hyperinflationary spiral. This outcome was the result of a specific intellectual solution to the problem of inflation. A group of economists at the Brazilian Central Bank, among them André Lara Resende — now a strategic advisor to Crown — had spent years thinking about the nature of inflation. Their insight was that Brazil’s inflation was primarily a crisis of confidence: at some point, prices kept rising because everyone expected them to keep rising. Fixing the currency required restoring confidence by breaking that self-fulfilling expectation. Their solution was the URV — the Unidade Real de Valor, or Real Unit of Value. Introduced on March 1, 1994, the URV was not a new currency; it was simply a unit of account. Prices were expressed in URVs; payments were still made in cruzeiros reais. But the URV was indexed to inflation — it absorbed the old currency’s instability while remaining stable itself. Gradually, as wages, contracts and prices migrated to URV denomination, the new unit of value earned the confidence that the old currency had lost. On July 1, 1994, the URV dropped the “V” — it stopped indexing to inflation — and became the official currency of Brazil: the Real. The V in URV stood for “Value”; in a hyperinflationary environment, the act of expressing value requires constant adjustment. Money is supposed to carry value through time, but inflation erodes that function, so the only way to preserve value is to index it, to keep it moving in step with inflation. V was a mechanism for delivering value reliably in an environment where the standard vehicle for that delivery had broken down.

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1.2 Interest Rates are the New Source of V

Thirty years on, Brazil faces a different but related challenge. The URV worked exceptionally well — and so has the Real. But the Real is still an emerging market currency, and has still lost roughly half its value against the dollar over the past decade. For anyone watching their BRL savings from the perspective of global purchasing power, this is a problem that invites a familiar question. Why hold BRL? Brazilian interest rates are among the highest of any major economy. When you account not just for the currency but for the return on holding it, BRL has, over much of that same decade, produced better total dollar-equivalent returns than holding dollars at the US risk-free rate. The Real may depreciate. But it depreciates against a backdrop of interest rates high enough to more than compensate. For anyone who actually earns the rate, it has been rational to stay in BRL. The problem is that access to the interest rate has not been equally distributed. Holding BRL in a bank account earns nothing, or close to it. Capturing the risk-free rate requires investing in Brazilian sovereign debt. That access has historically been the province of sophisticated investors and institutions, not the average holder of BRL, and certainly not the average holder of a digital currency. These are problems BRLV was built to solve.

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1.3 BRLV Brings BRL — and V — to the Digital Age

Accessing value on BRL balances is critical. But access alone is not enough. The lesson of 1994 was that value delivery is inseparable from confidence in the structure delivering the value. The URV worked not merely because it was pegged to inflation, but because it gave holders something they could trust independently of the currency’s continued functioning. It was structurally separate from the thing that had broken down. Stablecoins have not, for the most part, learned this lesson. Most do not deliver value on balances. Moreover, the standard approach to backing stablecoins — holding reserves in accounts controlled by the issuer, relying on the issuer’s operational continuity to honor redemptions — replicates exactly the kind of counterparty dependence that sophisticated holders know to avoid. A promise of 1:1 backing is not a legal claim. An audited balance sheet is not a bankruptcy-remote structure. The difference matters most in the scenarios where it is hardest to test: when an issuer is under stress, when regulators intervene, when the worst case arrives. Crown’s founding team approached these problems not only as technology challenges, but also as structured finance challenges. The question is how to hold sovereign bond reserves in a way that is genuinely, legally segregated from the issuer — not operationally separate, but bankruptcy-remote under applicable law, giving holders an enforceable legal claim on the underlying assets that survives any failure of Crown itself. The result is a structure that, to our knowledge, has not previously been implemented by any stablecoin issuer. BRLV is backed 1:1 by Brazilian sovereign debt held in that structure. Every BRLV is always worth 1 BRL. The bonds in reserve accrue value. The BRLV Rewards Program delivers value on BRLV balances: Rewards Points accumulate on qualifying balances every Brazilian business day, redeemable 1:1 for BRLV or BRL. No discretionary investment decisions. No speculation. The accumulation of value on BRLV balances is a consequence of holding the safest possible BRL reserve, in the safest possible legal structure. In 1994, the question was how to express value — V — in a currency that had stopped functioning as a store of value. The answer was to build something structurally separate from what had broken down, and to earn confidence through that separation. Thirty years later, the question is different but the logic is the same: how do you hold BRL in a way that delivers value without friction, and that you can trust to hold even under pressure? The answer is BRLV. The V in BRLV stands for what it has always stood for in Brazil: value, delivered reliably, in the form the moment requires. And we believe BRLV — delivering V on a digital BRL — is of strategic importance to Brazil. We are at the beginning of a cycle in which pieces of financial infrastructure are migrating from offchain, traditional systems to onchain, digital ones. And completely new infrastructure is being created onchain, in areas like agentic commerce, where offchain rails simply don’t work. Each piece of onchain financial infrastructure requires stablecoins — tokenized money — in order to function properly. Today, 99% of tokenized money is denominated in dollars. This new threat to Brazil’s monetary sovereignty requires what each previous threat has: a better way to deliver V on BRL.

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2. The BRLV Stablecoin: The Real Standard

BRLV is Crown’s BRL stablecoin. BRLV is a standard cryptographic token, and uses the ERC-20 standard on EVM blockchains. Every BRLV is always worth 1 BRL because it is redeemable at all times for 1 BRL of assets in Crown’s reserves, which are composed of Brazilian government bonds. See Reserve Structure and Bankruptcy Remoteness for more information. BRLV is designed for transactional simplicity: payments, accounts, treasury management, and all other contexts where a stable, reliable token price matters.

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3. Reserve Structure and Bankruptcy Remoteness

The core value proposition of BRLV is not just the stablecoin itself, but the legal and structural architecture that protects the reserves backing it.

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3.1 Reserve Composition

Crown’s reserves are composed exclusively of Brazilian sovereign debt and cash held in segregated accounts. This includes:

• Letras Financeiras do Tesouro (LFTs)
• ETFs linked to Tesouro Selic
• Cash held in segregated Reserve Accounts at approved financial institutions

All reserve assets carry direct Brazilian sovereign credit risk. There is no exposure to private credit, foreign currency or any other instrument that could introduce material market risk.

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3.2 The Bankruptcy-Remote Structure

Crown’s reserve structure was built using standard structured finance principles to achieve asset segregation and bankruptcy remoteness. It involves three independent parties:

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3.3 Fiduciary Assignment

To achieve bankruptcy remoteness under Brazilian law, the Reserve Assets are subject to a Fiduciary Assignment (Cessão Fiduciária). Legal ownership of the reserves is transferred to the Security Agent, which holds them in trust for the exclusive benefit of BRLV holders. The reserves are not part of the Issuer’s or the Guarantor’s estate and cannot be claimed by their creditors.

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3.4 What This Means for Holders

In the event of an operational failure at Crown, BRLV holders can activate the Security Agent, which will interact with the Guarantor on their behalf to recover the full value of the reserves. This is not a contractual commitment that depends on the Issuer’s solvency — it is a legal structure that operates independently of it.

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3.5 BRLY — The Onchain Representation of Offchain Reserves

Crown uses a rebasing ERC-20 token, BRLY, in the background to create an onchain representation of Crown’s offchain reserves. Crown’s customers do not interact with BRLY; rather, it is the base-layer infrastructure that brings the reserve’s daily accrual onchain. Each Brazilian business day, BRLY’s total supply adjusts upward in line with the Threshold rate — a predefined fraction of the CDI rate — reflecting the accrual of the underlying reserve assets, which also accrue value each business day. This rebase only executes if an automated check confirms the protocol’s collateralization ratio exceeds 100%, ensuring the 1:1 backing is never compromised. BRLV is created by wrapping BRLY. When BRLY held inside the BRLV contract rebases, the additional value created onchain is directed to the Rewards Pool, which funds the BRLV Rewards Program.

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3.6 Collateralization and Transparency

The protocol maintains a 1:1 Guarantee Ratio at all times: the fair market value of the Reserve Assets must always equal or exceed the total value of all outstanding BRLY. This ratio is monitored continuously by the Security Agent and verified by independent auditors. Daily, real-time attestation reports are publicly available at [link to transparency page].

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4. The BRLV Rewards Program

Holding BRLV in a qualifying wallet entitles participants to accumulate Rewards Points every Brazilian business day. Points accrue each Brazilian business day on the BRLV balance held in a qualifying wallet. 1 Point is always redeemable for 1 BRLV or 1 BRL. The accumulation of value on BRLV balances is a direct consequence of holding the safest possible BRL reserves — Brazilian government bonds — in what we believe is the safest reserves structure anywhere in the world. Participation in the program is tracked through the BRLV Rewards Token — an onchain credential issued to each participant’s qualifying wallet. The Rewards Token records the total Points balance accumulated. The mechanic for redemption of Points is a sale transaction of the Rewards Token.

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5. Technical Architecture & Operations

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5.1 Smart Contract Standards

BRLY and BRLV are based on the ERC-20 standard. BRLY incorporates a daily rebasing mechanism. BRLV incorporates wrapping and reward redirection logic. Crown’s smart contracts undergo continuous security audits by world-class security firms. Each audit involves a comprehensive line-by-line review by senior security researchers assessing for the full spectrum of known vulnerability types. Identified issues are tracked until resolved. The BRLV token address varies by chain. BRLY is on the Base chain, as are BRLV Rewards Tokens. Token addresses:

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5.2 Multichain Deployment

Crown’s smart contracts are currently deployed on EVM-compatible chains. The protocol uses an issuer-attestor model: Crown, as the issuer, controls and attests to the minting and burning of tokens. There are no decentralized cross-chain bridges required in this model, ensuring maximum safety. Token deployments on additional chains follow the same issuance model.

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5.3 Minting

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5.4 Redemption

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5.5 Instant Subscriptions & Redemptions

Crown also supports instant conversion between BRL and BRLV, available 24 hours a day, seven days a week — including outside Brazilian banking hours. Institutions that want or need instant BRLV subscriptions and redemptions are encouraged to contact us to learn more.

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6. Compliance and AML/CFT

Crown operates a comprehensive Anti-Money Laundering and Counter-Financing of Terrorism program aligned with Brazilian law and international FATF standards. The program uses a risk-based approach, mandatory institutional due diligence (KYC/KYB), and continuous onchain transaction monitoring. Wallets must be whitelisted to earn BRLV Rewards.

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7. Risk Factors

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8. Disclaimer

This document is for informational purposes only. It does not constitute an offer to sell or a solicitation to buy any financial instrument. Readers should independently assess all risks and consult their own legal, financial, and tax advisors. Digital assets involve significant financial and regulatory risks. Crown and its affiliates disclaim all liability for any loss or damage arising from reliance on this document.

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Crown Digital, 2026. All rights reserved. www.crown-brlv.com