Brazil’s central banks have revealed details of a newly-created blockchain platform that will be used to enable data exchange between the country’s financial regulators.
Known as ‘Pier’, the blockchain was created by the Banco Central do Brasil (BCB)’s own IT department and will be used to facilitate data securely between the central bank and other domestic regulators, the BCB noted in an official statement. Pier will specifically make it possible for data transfer between the BCBA, the Securities and Exchange Commission of Brazil, the Superintendence of Private Insurance and the National Pension Funds Authority.
BCB’s IT department deputy chief Aristides Cavalcante explained that being a decentralized ledger, blockchain technology was precisely initiated by the BCB for providing a ‘horizontal network of information-sharing’ that removes the need for a centralizing entity that could perhaps bring ‘operational hierarchical superiority’ over others.
Additionally, blockchain’s primary characteristic of immutability while making sure that no regulator interferes with any form of data given that every data request is recorded cryptographically ensures information genuineness, noted the central bank official.
It is an important step towards digitizing and automating communication between Brazilian regulators.
“Currently there is some exchange of information regarding authorization processes, which are not automated yet: staff from one of the institutions contact the others by letters or e-mails,” Cavalcante revealed.” Even the few queries that are automated by software still require some degree of human intervention.”
At first, the central bank hopes Pier’s utility is permitting access to data related to administrative sanctioning process, going on to state that ‘any participant may grant access to any information considered to be of mutual interest’ in real-time.
Pier is expected to come into operation by the end of the year and represents a significant step by the central bank to try different applications of blockchain technology regardless of previously calling bitcoin a bubble and pyramid scheme in October last year.