Project Khokha, an extensive test of distributed ledger technology, was a success, the SA Reserve Bank said in a report on Tuesday – but it is not yet time to move interbank transactions onto the blockchain technology (DLT) that underpins bitcoin.
“There are a number of considerations that require further exploration before determining whether DLT systems are suitable for use in wholesale interbank settlement....This is only the starting point,” said the bank.
Seven banks – Absa, Standard Bank, Capitec, Discovery Bank, FirstRand, Investec and Nedbank – were involved in the test that used Quorum, an “enterprise-focused” version of Ethereum.
The Reserve Bank described the project as “a proof of concept designed to simulate a ‘real-world’ trial of a distributed ledger technology (DLT)-based wholesale payment system.”
The seven banks involved each built their own nodes on the networks, using a mix of physical and cloud-based virtual machines.
“The results show that the typical daily volume of the South African payments system could be processed in less than two hours with full confidentiality of transactions and settlement finality," said the Bank in its report. "Transactions were processed within two seconds, across a network of geographically distributed nodes, with distributed consensus providing the requisite resilience. The SARB was able to view the detail of all the transactions to allow for regulatory oversight."