The South African Reserve Bank (SARB) has revealed its intention to experiment with distributed ledger technologies (DLTs).
In a media release dated February 13, the central bank announced the setting up of Financial Technology (FinTech) Programme, which aims to assess the emergence of fintech in a structured and organised manner and consider its regulatory implications.
One of the main objectives of this fintech programme is to trial DLT. The SARB said that it plans to launch “Project Khokha” which see to
“…gain a practical understanding of DLTs through the development of a proof of concept (POC) in collaboration with the banking industry. The objective of the POC is to replicate interbank clearing and settlement on a DLT which will allow the SARB and industry to jointly assess the potential benefits and risks of DLTs. The POC involves the processing of wholesale payments using Quorum, an Ethereum enterprise DLT. The SARB is aware of multiple DLTs being experimented with globally.”
The SARB has selected ConsenSys as its technology partner for the project. It clarified that the initiative does not imply a drastic move to DLT, but “rather structured approach to understand the implication of using a tokenised asset on DLT technology to transfer value.”
Other objectives of the fintech programme include a review of the central bank’s position on cryptocurrencies and investigate and decide on the applicability of innovation facilitators for the SARB
