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Banco Central do Brasil getting busy with blockchain R&D

Tuesday 14 November 2017 | 01:09 PM CET

Banco Central do Brasil is now developing proofs-of-concept on four different platforms, trailing Ethereum, JPMorgan`s Quorum and Hyperledger Fabric alongside its Corda work.

The PoCs broadly focus on using blockchain to both back-up the central bank's current real-time gross settlement system (RTGS), called the Brazilian Payment System, as well as better align the organization with the growing momentum for central banks to innovate using blockchain technology.

While the blockchain team at Brazil's central bank had considered a number of use cases, including enabling foreign trade in local currencies and an identity management system, as far back as January 2018, it ultimately selected RTGS as its focus.

Instead of being netted periodically, RTGS is used to allow banks to settle their large-value debits immediately as they occur. Because these transactions are relatively infrequent, they have been identified by multiple central banks as a potential use case for blockchain.

The bank processes 314,000 transactions per day, moving a total of about USD 255 billion by today's exchange rate. But while RTGS is the primary focus of the central bank's blockchain work, it's also testing a blockchain-based “information exchange”.

Revealed for the first time to CoinDesk, the exchange, called Know Your Citizen (seemingly a play on the regulator-mandated know-your-customer compliance), is powered by Quorom in Microsoft's Azure cloud. It also uses Truffle, a popular Ethereum development framework, to interact with smart contracts.

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