In a press release on Wednesday, November 3rd, KaJ announced said that it had initiated discussions with the Central Bank of Brazil to partner on the country’s digital Real roll out. Banco Central do Brasil (BCB) has been exploring and working on a central bank digital currency (CBDC) since 2020.
Lithosphere Blockchain to Partner with Central Bank of Brazil to Launch Digital Real CBDC Trial, Launches Lithosphere (LITHO) IEO https://t.co/ZAV60lagxg
— JamesRuleXRP💫HODL💫DYOR💫Astrolight🚀👊😎 133K (@RuleXRP) November 3, 2021
In August 2020, the bank created a multidisciplinary study group to analyze its risks, advantages, and potential impacts on the Brazilian economy. The bank first said that the Brazilian nation should be ready for a Digital Brazilian Real by 2022, however, it recently has delayed the roll out for the next two to three years.
Roberto Campos Neto, president of the Central Bank of Brazil, indicated that the central bank was making progress and could release Central Bank digital currency as early as possible, provided the infrastructure and necessary conditions for implementing digital currency are met.
Currently, the bank is partnering with KaJ Labs, the developer of Lithosphere blockchain, to launch the trail of its CBDC. KaJ Labs or KaJ Labs Foundation is a Seattle-based decentralized research organization focusing on AI and blockchain technology.
Its Lithosphere blockchain is a next-generation platform for cross-chain decentralized, censorship resistant applications powered by AI & Deep Neural Networks (DNNs) for intelligent smart contracts and a novel Myriad Distributed Key Management (MDKM) scheme for key management.
According to announcement, in this CBDC trials:
“Lithosphere will assist with distributed ledger technology (DLT), tokenizing the bonds and the wholesale payment token using its custom blockchain interoperability solutions. The trial with the Central Bank of Brazil will explore both forms of tokenized money to settle debenture or bond transactions, to be issued, settled and cleared on a permissioned blockchain.”
Brazil can be considered a crypto hub in Latin America. This country has a strong crypto infrastructure and it is expected to be the second country after El Salvador to cryptocurrencies a legal tender. It also the first LATAM country to approve a Bitcoin ETF.
Even though, no such plans are under consideration in the government body, the central bank of the country is committed to launch a digital version of national fiat currency Real. But even before a CBDC, the bank has launched an instant payment PIX in November 2020 that provides 24/7 payments in up to 10 seconds via mobile apps, internet banking and ATMs. The PIX system can also become a backbone of upcoming Brazilian CBDC.
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