Brazil’s central bank’s maiden blockchain project, the digital real, made an entry through a public blockchain. A local paper, “Valor Economico,” stated that the trial project was done by Mercado Bitcoin, a crypto exchange, and Stellar protocol, and was designed to bring awareness to low-cost as well as real-time settlements to the users. Special attention was placed on the simulated delivery vs. payment model for the instant exchange of assets plus funds.
Fulvio Xavier, head of special projects at Mercado Bitcoin, said the thesis was geared at proving the possibility of safety and viability in transacting using digital assets leveraging public networks. He also said that the Brazilian central bank has always been concerned about what happens when transactions exit their hands.
A recent study has shown that consolidating a tokenized system of Brazil’s payment system using decentralized finance could be possible. Stellar has gone ahead and stratified specific features. The central bank of Brazil has been brooding over the use of permissioned and private blockchain in its CBDC (digital currency issued by a central bank) though recent research has indicated that public blockchains can still avail security and a myriad of extra benefits.
“Stellar is equivalent to a proxy for the regulatory agency to test run the digital real’s controls on a public/open platform,” said Roberto Durscki, Stellar’s head of partnership. Practicing on this makes piloting relatively complicated as well as successful use cases with accessibility to defi applications.
These deductions from this study will then aid the central bank of Brazil in its bid to kickstart its digital real so as to spruce up the physical currencies. A major takeaway from this research was how easy it was to onboard members with no Web3 platform or digital wallet experience nor any similarity with current rules.
CBDC Launch Inches Closer
Plans for an all-out CBDC launch in a few months, with the Brazilian central bank looking at 2024 as the launching year, are in full gear. Roberto Campos, the Brazilian central bank’s governor, affirmed that the plans initiated while 2021 was ending will greatly improve financial inclusivity.
Several financial and tech institutions have expressed partnership interest with the nation’s banking system regulator in a bid to undertake CBDC experiments. A selected few, such as Visa, Aeve, Consesys and Microsoft, have been chosen to investigate different capabilities of this digital real, especially in digital currencies through DvP, Rural financing as well as SME finance.
When institutions such as central banks begin testing reals, there is no doubt that companies such as Bit Digital Inc. (NASDAQ: BTBT) gain more confidence that the world will soon fully embrace digital currencies as a medium of exchange.
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