South Africa’s central bank has published the findings of a 14-week distributed ledger project that simulated interbank transfers between itself and the commercial banking community within South Africa.
On Tuesday, South African Reserve Bank (SARB) released a report on Project Khokha, which shows promising metrics surrounding distributed ledger technologies (DLTs) like blockchain.
According to the report, Project Khokha showed that DLT was able to process an entire day’s worth of the South African payments system’s volume in two hours, with “full confidentiality of transactions and settlement finality.”
The proof of concept (PoC) was comprised of four phases laid out over a 14-week period from January through April of this year: education, creating the ecosystem, development of contracts/solution, and performance testing. Project Khokha was implemented using Quorum, a blockchain based on Ethereum’s core code, via a network of geographically distributed nodes that combined to reach distributed consensus during the trial.
SARB was able to view the details of all transactions, allowing it to have regulatory oversight. Furthermore, PwC (formerly PricewaterhouseCoopers) was contracted to assist Project Khokha in reviewing documentation, reporting findings, gathering insights, and interviewing “key stakeholders.”
Specifically, the project utilized Istanbul Byzantine Fault Tolerance (IBFT), a security protocol inspired by an MIT paper from 1999, alongside Pedersen commitments and range proofs, which were employed to deliver a combination of scalability, resilience, confidentially, and finality.
Per the report:
“The regulatory and legislative elements are particularly complex. A DLT-based system could possibly enable more efficient regulation that is done in real time via an observer node for the regulator. At the same time, in a distributed system, there are elements of control that a regulator like the SARB may have to consider relinquishing in order to achieve some of the other benefits (such as distributed consensus), which would improve resilience by removing the single point of failure.”
Although the SARB considers this PoC a success, they note that “a fully live DLT-based payments system is not currently planned in South Africa.”
Jordan Daniell is a full-time staff writer for ETHNews with a passion for techno-social developments and cultural evolution. In his spare time, he enjoys astronomy, playing the bagpipes, and exploring southern California on foot. Jordan lives in Los Angeles and holds value in Ether.
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