Mercado Bitcoin is testing a tokenized version of the digital reality
Cryptocurrency platform Mercado Bitcoin has tested a tokenized version of the Brazilian digital real using the Stellar network.
The digital real project, which represents Brazil’s effort to create a digital central bank currency, is taking steps toward a potential issuance. Local cryptocurrency exchange Mercado Bitcoin has conducted a series of pilot tests exploring the interconnection of a tokenized version of digital reality.
Using the Stellar blockchain as a public blockchain, the tests went through all the steps that a normal user would have to perform to use a tokenized, on-chain version of the digital reality. These include Know Your Customer (KYC) and anti-fraud procedures derived from a digital decentralized identity system. The ID and fraud prevention processes were handled by Clearsale and CPQD, which ensured that the transactions did not conflict with Mercado Bitcoin’s transaction processing tool, Mercado Bitcoin Pay.
Since the pilot test phases were successful, they proved that the Stellar blockchain could act as a proxy for the operation of the digital real. Mercado Bitcoin officials quoted by news.bitcoin.com explained that the plan was to prove the feasibility and security of conducting transactions with digital assets using a representation of reality on public networks.
Brazil’s CBDC Test Phase
In February 2023, Brazil revealed its plans to launch a real-world series of digital tests for its CBDC, focusing on protecting the privacy of financial data and transactions. The aim is to ensure the security of CDBC as well as the privacy of customers.
To fully understand how the digital real would behave in different situations, the Central Bank of Brazil has selected nine institutions (Mecardo Bitcoin included) to conduct several tests as part of the Laboratory of Financial and Technological Innovations (LIFT) challenge. The LIFT challenge is an open initiative in which a large number of organizations participate.
Each of these organizations must meet a set of requirements to be part of the challenge, such as submitting their various project reports or files no later than April 25, 2023. After that, the digital reality pilot testing process can continue. After release, the pilot will be continued within a limited and well-controlled scope. Ultimately, the only tokenized asset that will be used for transactions will be the one recognized by the industry.
