Aave to Move Forward in Brazil’s Central Bank Innovation Challenge

The central bank of Brazil revealed on March 3rd that it has picked a total of nine projects to advance in its challenge to develop a central bank digital currency (CBDC). One of the projects is Aave.

The LIFT Challenge

The central bank of Brazil revealed the so-called LIFT Challenge where the current theme is “Real Digital.”

The main objective of this challenge is to evaluate use cases of digital currencies issued by the central bank as well as how technologically feasible they are. There are multiple characteristics that participants have to keep in mind when submitting a proposal some of them include, but are not limited to:

• Scalability of the proposed solution aimed at “retail applications of national scope.”
• Privacy of the information that used in the use case, yet compliance with existing regulations.
• Interoperability
• Programmability

In a recent announcement, Banco Central de Brasil revealed that they’ve selected 9 projects for monitoring, representing roughly around 20% of the total proposals that were submitted by all 43 different companies.

Aave Amongst the Selected Few

One of the projects that made the cut is Aave. The description of the protocol is that it “gathers resources from several savers (forming a liquidity pool) with a focus on offering loans and guaranteeing the adherence of these operations to the rules of the financial system, using DeFi tools.”

Other companies whose proposals were accepted for the next step include Santander Bank of Brazil, Febreban, Giesecke, VERT, Visa do Brasil, and so forth.

Brazil is putting serious effort into the cryptocurrency industry. As CryptoPotato recently reported, senator Flavio Arns introduced a bill that would regulate virtual assets and service providers such as brokers and cryptocurrency exchanges. It would stop the local SEC from meddling in crypto-related legislative activities, excluding ICOs. The bill was passed by the country’s Senate in late February and has moved to the Chamber of Deputies.