Reserve Bank of Australia To Explore Potential Use Of CBDC In The Country Using Ethereum-Based Distributed Ledger Technology
Reserve Bank of Australia To Explore Potential Use Of CBDC In The Country Using Ethereum-Based Distributed Ledger Technology
November 4, 2020
Reserve Bank of Australia To Explore Potential Use Of CBDC In The Country Using Ethereum-Based Distributed Ledger Technology
Reserve Bank of Australia To Explore Potential Use Of CBDC In The Country Using Ethereum-Based Distributed Ledger Technology
November 4, 2020

The Reserve Bank of Australia (RBA), the financial institution, will be partnering with the Commonwealth Bank, National Australia Bank, the financial services company Perpetual, and software company ConsenSys, on a project to explore the potential use of a wholesale central bank digital currency in the country using “Ethereum-based distributed ledger technology.”

It has been reported that the RBA stated it would be researching the development of a proof-of-concept for “the issuance of a tokenized form of CBDC.”

However, it specifically mentioned wholesale market participants potentially using the digital currency for tokenized syndicated loans on a DLT platform and exploring the implications of delivery-versus-payment security settlements with cross-chain atomic swaps.

Michele Bullock, the Assistant Governor of Reserve Bank of Australia, said:

“With this project we are aiming to explore the implications of a CBDC for efficiency, risk management and innovation in wholesale financial market transactions.”

He added:

“While the case for the use of a CBDC in these markets remains an open question, we are pleased to be collaborating with industry partners to explore if there is a future role for a wholesale CBDC in the Australian payments system.”

Likewise, the move is part of an ongoing about-face for the RBA when it comes to CBDC policy.

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On October 14, the head of payments policy at the RBA said that the bank would continue to research CBDCs despite the financial institution by stating that there was not a strong policy case for issuing one in September.

As alternatives to issuing a CBDC, RBA has pointed to the success of the country’s efficient, real-time New Payments Platform, and stated that it is willing to provide access to fiat banknotes “for as long as Australians wish to keep using them.”

Thus, RBA said that the project will be finished by the end of the year and it will issue a report in 2021.

Source: Cointelegraph


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Ishita Bora

Ishita Bora is a Senior Content Creator at Digital Notice Media Labs with an experience of 1 year. She has completed her Master's Degree in Language and Linguistics in 2019 from Gauhati University, India. Her interest lies in blockchain technology and cryptocurrency space, as she loves writing about blockchain and other blockchain-related articles. Currently, she is working on blockchain-based news, reviews, featured articles, and guides.