The test conducted by the local exchange Mercado Bitcoin demonstrated that a tokenized version of the digital real could be used in public blockchains while adhering to all compliance rules set by Brazilian laws.
The test aimed to examine the interconnection of a tokenized version of the digital real on the Stellar blockchain. It included all the steps that a regular user would have to conduct when using a tokenized on-chain version of the digital real. These steps included traceability, know-your-customer, and anti-fraud procedures, which were derived from a digital decentralized identity system.
Clearsale and CPQD conducted the tests, handling the digital identity and fraud prevention processes to ensure the transactions were compliant with Mercado Bitcoin Pay, the tool used to process the transactions. The success of the pilot test demonstrated that public networks such as the Stellar blockchain can be used as proxies for the operation of the digital real, providing a secure and viable option for conducting financial transactions.
The success of this test, according to the institutions involved, demonstrates that public networks, such as the Stellar blockchain, can act as proxies for the functioning of the digital realm. Fulvio Xavier, who oversees special projects at Mercado Bitcoin, commented on this development, stating that their thesis was to demonstrate the feasibility, safety, and possibility of conducting transactions with digital assets using a representation of the real on public networks. As transactions move beyond the purview of the Central Bank, there is a persistent concern about their implications, and this success can alleviate some of those concerns.
The completed test is part of a larger array of projects conducted to assess the behavior of the digital real in different situations. Mercado Bitcoin is part of nine institutions selected by the Central Bank of Brazil to run these tests as part of the special Laboratory of Financial and Technological Innovations (LIFT) challenge issued in 2022.
In a statement made on February 14th, Roberto Campos Neto, President of the Central Bank of Brazil, announced plans to conduct a full pilot test of their central bank digital currency in order to establish a comprehensive development roadmap. The goal is to complete the pilot test before Campos Neto's mandate as president ends in December 2023. This indicates that the digital real project is a top priority for the Central Bank of Brazil, and they are committed to rolling out the digital real in the near future.
This successful test marks a significant step forward for the digital real project, demonstrating its viability and safety as a digital asset on public networks. With more tests underway, the digital real could be on track for a comprehensive rollout in the near future, revolutionizing the way Brazilians conduct financial transactions. This would provide increased security and transparency in financial transactions and boost the country's economy by providing greater financial inclusion to all Brazilians.