According to the Central Bank of Brazil, the Digital Real pilot project will use an Ethereum-compatible permission-based blockchain to issue tokenized national currency. Hyperledger Besu, the open-source platform chosen for the pilot, will allow the project to run without licensing fees and allow maintenance costs to be addressed later if the platform is definitely chosen.
Tokenized digital real pilot to adopt Hyperledger Besu, which is Ethereum compatible
Brazil continues to move forward with plans to offer a working version of its Central Bank Digital Currency (CBDC), the Digital Real, by the end of 2024, according to a report byTo this end, the country’s central bank has decided to use an open source, tokenized digital real as an operational platform for the ethereum-compatible blockchainplatform, Hyperledger Besu, has been chosen.
Local analysts believe that compatibility with Ethereum may open the economic playing field more competitively, with a number of third parties developing applications and services using tokenized digital reals. However, this could also minimize the role of banks in the new digital economy. In this regard, JC Bombardelli, CTO of Ed-Tech startup Gama Academy, stated.
I don’t think it’s a total nod to the world of defi because it would give up a lot of control that central banks never want to have.
Another reason for the choice would be that Hyperledger Besu is open source, so governments can use it without paying licensing fees.
two-tier structure
Testing, which is expected to begin this month, will involve only tokenized digital reals, which will be used for a variety of transactions and will be issued by private banks against deposits.
The final structure of the digital real will be two-tiered, with the real currency controlled only by authorized institutions. In this regard, Fabio Araújo, coordinator of the Digital Real project at the Central Bank of Brazil, stated.
The regulatory framework will be the current one in order to avoid asymmetries in relation to what currently exists. Digital reals would be useful for interbank transactions, and tokenized reals would be a kind of stable coin issued by banks.
The digital real structure would allow banks to maintain their functionality and answer a series of privacy and compliance concerns. However, other CBDCs, such as China’s digital renminbi, deliver real currency to users, which can then be used directly for payments via a digital wallet.
What do you think about the decision to adopt Hyperledger Besu, an Ethereum compatible system, for issuing digital reals? Let us know in the comments section below. {4