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Brazil’s approach to blockchain and digital currency has moved beyond simply regulating cryptocurrencies.
On Thursday, Brazil launched its new blockchain network after the Court of Accounts of Uniam (TCU) and the Brazilian Development Bank (BNDES) reached an agreement to cooperate together.
The development of the network started in 2018. The goal was to migrate all public expenditures to the network to increase transparency and traceability in spending. Consequently, the network was designed on the Hyperledger Besu 2.0 that operates on the proof-of-authority consensus mechanism. The Proof-of-authority will allow state actors to maintain control of the network.
Earlier in March, the head of blockchain initiatives at the Development Bank of Brazil (BNDES), Gladstone Arantes gave insights into the project. She explained that the infrastructure one built will provide a trustworthy platform on which institutions can build their applications.
Blockchain Network Can Help Fight Corruption
Brazil’s approach to blockchain and digital currency has moved beyond simply regulating cryptocurrencies. Now, the country is leveraging the blockchain network to help in its fight against embezzlement and all forms of corruption.
Ana Arraes, president of Uniam’s TCU explained that the network offered advantages in auditing data provided for public spending. She said, “The use of Blockchain technology becomes widely discussed because it allows greater protection, transparency and integrity in the storage of information in public databases.”
Blockchain technology has been deployed for use in similar ways in other Latin American nations. For example, Colombia conducted a pilot project in 2021 to test the use of blockchain in fighting corruption. The project lasted for 3 months. Also, Peru partnered with LACChain to develop traceability solutions. Similar projects are also being developed in Europe.
Manager of the Information Technology Area, BNDES, João Alexandre Lopes, noted that the project will welcome partners once it is formalized. What this means is that the partners will be able to enjoy the infrastructure and share the benefits for the general interest of the public interest.
Beyond this, Brazil is currently evaluating the feasibility of a stable coin tagged Real Digital. Earlier in the year, it chose nine partners, including Mercado Bitcoin, to develop the country’s central bank digital currency (CBDC). According to the Central bank, it will introduce a pilot program this year and by 2024.