The Reserve Bank of Australia (RBA) is one of major central banks researching the concept of Central Bank-issued Digital Currency (CBDC).
In a meeting on Friday about the payment system in the country, the Payments System Board of the central bank admitted that they don’t see any strong case for issuing a retail CBDC in the country. They are mostly focused on researching the feasibility of launching a wholesale CBDC instead.
RBA is Sceptical About Retail CBDC
Retail central bank digital currencies are the ones launched for the general public, just like the Chinese long-planned digital yuan. On the other hand, a wholesale CBDC would be specifically designed “for the settlement of transactions in wholesale markets, such as purchases of financial assets or large-value payments.”.
Having discussed the ongoing CBDC development taking place internationally, the Board said there wasn’t any strong case for launching a retail CBDC. However, the bank will continue its collaborative effort with a number of external parties to research the possibility of a wholesale CBDC.
The Board is following this work closely but continues to be of the view that there is not a strong public policy case at present for issuance of a retail CBDC in Australia. The Bank is continuing its collaborative research project on a wholesale CBDC with a number of external parties, which is due to be completed in the coming months.Reserve Bank of Australia [media release]
RBA Collaborated with Banks on CBDC
Back in November 2020, the central bank of Australia collaborated with some banks in the country, including the Commonwealth Bank, National Australia Bank, and blockchain company, ConsenSys Software. The consortium was driven by the objective of exploring the implications and potential benefits in issuing a wholesale CBDC on blockchain technology. At the time, the RBA planned to develop a proof-of-concept (POC) to pilot the CBDC via a tokenized form.
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