Digital Real Pilot to Run on Ethereum Compatible, Permissioned Blockchain – Finance Bitcoin News

According to the Central Bank of Brazil, the digital real pilot project will use an Ethereum-compatible, permissioned blockchain for issuing the tokenized version of the country’s currency. Hyperledger Besu, the open source platform chosen for the tests, will allow the project to run without licensing costs and deal with maintenance costs later, if the platform is definitely chosen.

Tokenized Digital Real Pilot to use Ethereum compatible Hyperledger Besu

Brazil continues to move forward with its plan to deliver a working version of its own central bank digital currency (CBDC), the digital real, by the end of 2024. According to reports, the country’s central bank chose Hyperledger Besu, an open-source, Ethereum-compatible blockchain platform, as the basis for running the tokenized version of the digital reality.

Local analysts believe that its compatibility with Ethereum could bring a number of third parties to develop applications and services using the tokenized digital reality, opening the economic playing field to more competition. However, this can also minimize the banks’ role in the new digital economy. About this, JC Bombardelli, CTO of the ed-tech start-up Gama Academy, stated:

I don’t think it’s a total nod to the def world, because that would mean giving up a lot of controls that the central bank would never want to have.

Another reason to choose Hyperledger Besu would be its open source origin, which would allow the government to use it without having to pay for licenses.

Two-layer structure

The tests, which are scheduled to start this month, will only include the tokenized version of the digital real, intended to be used in various transactions and issued by private banks with deposits as collateral.

The final structure of the digital real will include a two-tier system, where the real currency will be managed only by authorized institutions. Fabio Araujo, coordinator of the digital real projects at the central bank of Brazil, said about this:

The regulations will be those in force to avoid asymmetries in relation to what exists today. The digital real will earn more for interbank transactions and the tokenized real will be a kind of stablecoin issued by banks.

The digital real structure allows banks to retain their functions within the system and addresses a range of privacy and compliance concerns. However, other CBDCs such as the Chinese digital yuan deliver the actual currency to users and can be used directly to make and receive payments via a digital wallet.

What do you think about the decision to use Hyperledger Besu, an Ethereum compatible system, for issuing the digital reality? Tell us in the comments section below.

Sergio Goschenko

Sergio is a cryptocurrency journalist based in Venezuela. He describes himself as late to the game, entering the cryptosphere when the price spike occurred during December 2017. He has a computer engineering background, lives in Venezuela and is influenced by the cryptocurrency boom on a social level, offering a different point of view on crypto success and how it helps the unbanked and underserved.

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