TechFlow reports that the Bank of Italy has released a report announcing the open-sourcing of FBFT, a permissioned consensus protocol improved from Bitcoin, aimed at researching central bank distributed ledger technology (DLT) systems.
The protocol combines the Practical Byzantine Fault Tolerance (PBFT) algorithm with the FROST signature scheme, ensuring consensus while preserving the confidentiality of validator identities.
The Bank of Italy stated its goal is to lay the foundation for DLT payment systems operated collaboratively by multiple central banks. The report also mentioned that the research team plans to further explore areas including Bitcoin's Layer 2 payment channel networks, payment privacy, asset tokenization, and cross-border payments.
Researchers chose to base their work on Bitcoin rather than Ethereum, arguing that Bitcoin is more focused on digital payments and offers simpler off-chain scalability through payment channel networks. While acknowledging that DLT payment systems still have a long way to go before becoming a de facto standard, the team likened Bitcoin to an "open standard" in the crypto space, analogous to the TCP/IP protocol in the internet ecosystem.
