kingjotaro / projetostable Goto Github PK

PT-BR version

Excali

Unfortunately, governments do not see the inflation as a problem, and often it is the people who end up paying the bill through an invisible tax that heavily affects the poorest and small business owners. The general population usually doesn't have time to worry about financial protection, while large companies need to create a department just to handle their cash, and individuals and businesses often outsource this activity to a third party, trusting that they will manage it in the best possible way.

My idea to change this reality is simple and effective. A stable digital currency that is immune to inflation, based on government bonds that offer security and protection against inflation, in addition to a small return. This currency would make money much more efficient, allowing it to be spent at any time while still earning a return.

This initiative would offer ease and convenience for those who do not have the time or knowledge to organize their finances, making financial protection even more accessible and effective. All of this is based on a proposal that is inspired by the old URV model before the Real Plan, but with a completely digital approach.

The digital URV is a Stablecurrency that aims to protect its users from inflation by anchoring its value to an underlying asset such as government debt securities. This strategy provides users with protection against currency devaluation, while also allowing the Stablecurrency to be easily traded and used in transactions.

By acquiring a digital URV, the user fluctuations is effectively acquiring a portion of the underlying asset, which provides them with value assurance and security compared to the national currency. The initial parity of 1:1 with the Real allows the digital URV to be easily integrated into the Real "R$" economy, without replacing the national currency as the unit of account.

As time passes and the digital URV appreciates in value relative to the Real due to its backing in government debt securities, there is an expectation of a value dislocation, causing the digital URV to be valued above one unit of Real. However, even with this increase in value, the national currency will continue to be used as a reference for calculations and accounts, making the digital URV a highly transactional asset in the Brazilian economy. In summary, the digital URV is a solution that aims to protect users against inflation and offer a secure and efficient way to transact values in the economy, keeping up with technological advancements of the digital Real.

To make the digital URV an attractive option for transactions, it is necessary to maintain a certain level of speed and scalability, and this solution should be addressed alongside the evolution of the digital Real in order to maintain greater integration between the systems.

Part of this process is planning which bonds will be traded and defining which types of bonds the URV (Real Value Unit) will represent.

There are several options of bonds in the financial market, and the choice of which ones will be used as collateral for the Stablecurrency will impact its variation. In the case of the project in question, one option would be to use IPCA+ Treasury bonds, which offer greater stability to create an anti-inflation Stablecurrency. These bonds remunerate the inflation value plus a pre-fixed bonus, offering some predictability of the Stablecurrency yield.

However, it is also possible to explore other options, such as creating a more volatile currency indexed to a stock index. Although this option has a greater market fluctuation, it could be a great financial instrument for leveraging and facilitating investment.

Among the technologies to be explored, the one that certainly stands out the most is that of central bank digital currencies (CBDCs), created by the central bank, which will leverage the transfer capabilities of digital Real with blockchain. Keeping up with the evolution of digital Real development is essential in order to reuse some of the knowledge in creating a digital URV. I strongly believe that interoperability between technologies will be key to the success of any product that may be created in the post-era of CBDCs. All products and solutions will revolve around this big rock solid that digital Real will become.

Equally important is the need to monitor the legislation that will apply to private banks with the creation of CBDCs. Digital Real stems from the idea that the central bank will allow the issuance of tokens backed by real assets by private banks. Therefore, it will be extremely important to keep track of the legislation that will apply to such a business model that does not yet exist.

In a last resort, it would also be possible to create a business model separate from the current financial system on a blockchain with a customized block size and validation. However, this will be a topic for another project, and I will leave this option open.

The architecture proposed in this project is an initial concept for the implementation of the digital URV. However, the final design and implementation will depend on the regulatory framework established by central bank. Therefore, at this stage, it is not possible to focus on technical details, but rather on developing a clear understanding of the proposed processes, functionalities, and strategies that could be employed. As regulations are established, the project can be adapted to ensure compliance and feasibility. Nonetheless, it is important to continue exploring potential technological advancements and possibilities for the digital URV to be a robust and efficient solution for inflation protection and financial inclusion.