The South African Reserve Bank (SARB) has today released a report on a distributed ledger technology (DLT) project nicknamed Khokha. The project was designed to simulate a ‘real-world’ DLT-based trial of a wholesale payment system.
Tests were able to process 70,000 transactions (representing the country’s typical daily payments) in only two hours, with full confidentiality and distributed consensus providing resilience. For regulatory insight, SARB were able to view details of all transactions
The system was built on Quorum, using Istanbul Byzantine Fault Tolerance (IBFT) and Pedersen commitments along with range proofs to deliver the necessary scalability, resilience and confidentiality. This is the first time such a collaboration of technologies has been used.
The report goes on to mention how central banks recognize the disruptive nature of emerging fintech concepts such as those found in cryptocurrencies. As a result, they initiated these projects to gain insight into blockchain technology and develop frameworks to address the potential changes. The new Fintech Unit established in August last year is the first of these structures put in place to assess implications.
Participation in the trial saw support from major banks, including Standard Bank, Absa, Investec and Capitec.
For now, the trial is simply a proof-of-concept blockchain implementation and will not replace existing settlement procedures. However, it shows a growing interest in the technology from South Africa and a positive future outlook for cryptocurrencies in the country.
A short brief of the full report is provided here.
Image From Shutterstock