Understanding the Tezos blockchain
How-To
Decentralized Applications
Tools
🇪🇺
EuroTz
What is a CBDC?
Central Bank Digital Currency (CBDC ) is a digital form of fiat money, likely to be implemented on a distributed ledger to better control the issuance, flows, and ownership of the digital currency. CBDCs are not yet a standardized term and no rule-making, however, we can recognize some characteristics:
- Central bank-issued digital money and a liability¹ of the central bank
- Backed by the government in the same way that current forms of fiat currency are backed
- Distinct from existing accounts at Federal Reserve Banks
[1]: Liabilities are what the bank owes to others. Specifically, the bank owes any deposits made in the bank to those who have made them. The net worth or equity of the bank is the total assets minus total liabilities. (The full article).
What is EuroTz?
Started in February 2020, EuroTz is a Proof of Concept proposal to build a collateralized Euro stable coin on the Tezos Blockchain.
- It is a token that can be used on the Tezos public Blockchain oron a Tezos private Blockchain;
- It is backed 1:1 by euro fiat deposits made in reputable banks ²;
- It is auditable in real time (the 1:1 backing is verifiable inreal time);
- It can be emitted by a duly licensed and regulated financialinstitution based in the EU.
[2]: For each coin issued on the blockchain, one equivalent monetary unit, also known as fiat (EURO, USD, GBP, etc) is escrowed.
What are the functionalities and purposes of EuroTz?
- First, it creates a Euro backed digital currency(100% covered byeuro deposits in a hive-off account via PSD2 standard) that canease interbank exchanges and consequently exchanges betweenconsumers.
- On top of this stable coin can be built a software ecosystemallowing to tokenize OTC derivatives (bonds, options, structuredproducts...);
- It offers a secure mechanism of Delivery versus Payment(DvP) toensure a well unwound of digital assets trading.
- One of the most innovative aspects is the possibility for adigital asset owner to swap its asset for another one, whiledownplaying fees and securing the swap.
What is Delivery versus Payment (DvP)?
Delivery versus payment is a mechanism that links a securities transfer and a fund transfer in such a way as to ensure that delivery of securities occurs only if payment of funds occurs,
- It provides compliant, atomic and flexible transactional featureswith no intermediaries;
- It can automatically handle reporting and regulatory requirementsand all the post-deal lifecycle steps;
- It is traceable and fully supports AML and KYC can provide marketdata to products requiring them and connectivity to secondarymarkets supporting heterogeneous products;
Smart contract securities that will be created on the Tezos blockchain can embed this functionality.
How settlement is performed on the blockchain?
First, through a retailer platform, a consumer who wants to buy EuroTz has to connect to his traditional bank account(in euro) via the PSD2 standard and receive the equivalent amount in EuroTz on his Tezos wallet.
However, the consumer doesn't necessarily need to be familiar with the native Tezos address or hold a Tezos account, the transfer management will be managed in the backend by a Feeless transfer/approval contract process.
How is Camunda BPM used to assume compliance?
- Provide Business Process management/statistics that help to managethe euroTz Back-office interaction.
- Transactions are translated into business workflows
- At each process step, an administrator can have a global view ofthe current transactions state in real time, so he can performmanual verifications on the transactions (KYC / AML, verificationof sufficient funds of an address. This process offers acompliance mechanism to euroTz ).
Camunda BPM (Business Process Manager): an open-source workflow and decision automation platform.
How events are managed on euroTz?
A contract called EventSink is used as an alternative to the events. After each successful transfer or approval, an internal call to the eventSink contract is fired as an event summarizing information relevant to the event.
Sources
Last modified 5mo ago