The Central Bank of Brazil will focus its first real digital tests on determining the levels of privacy and security that can be achieved with the proposed central bank digital currency (CBDC) infrastructure. The tests will take place later this year and will establish a simplified operation for transacting with a yet to be determined tokenized asset.
Central Bank of Brazil to launch digital real test operation later this year
The Central Bank of Brazil is accelerating the real digital project, approaching its pilot phase. The institution announced that it would be carrying out a series of operational tests to verify the functionality of the architecture proposed for the system.
Fabio Araujo, coordinator of the real digital project of the Central Bank of Brazil, explained that security and privacy would be two of the most important areas to examine with these tests. Araujo said Transmission:
We are going to simplify the operation, but we are going to have several participants exchanging information to see the degree of security and privacy that we can give the system. youThe pilot is focused on that.
Araujo explained that the objective of this test would be to determine if the leakage of transaction information derived from the system is compatible with current regulatory requirements.
test details
The tests described by Araujo would begin after the current digital real lab phase, which is currently being conducted as part of the LIFT challenge, an open project that brings together various organizations. The challenge attracted nine different proposals that aim to include the digital real as part of economic endeavors.
Institutions and organizations that are part of the LIFT challenge must deliver their final project reports by April 25. The new set of pilot tests is expected to take place after this event. However, the pilot will be limited in scope, shown in a simplified operating environment, and will only feature the introduction of another tokenized asset not yet selected for transactions.
The test will also allow the Central Bank of Brazil and the Brazilian Securities Commission to examine how third parties could interact with the system, including banks, which will be able to issue their own digital real-backed tokens. This expanded sandbox environment will be open to institutions and banks in 2024.
While there is no announced launch date for the digital real yet, Roberto Campos Neto, president of the Central Bank of Brazil, hinted at a December 2024 launch date.
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