RBA to Evaluate Digital Currency


The Reserve Bank Of Australia is currently conducting research into potentially launching a digital currency, known as e-AUD.

CBA’s managing director of blockchain and digital assets Sophie Gilder claims the digital payment will work ‘exactly’ like Australian money.

The RBA is researching the possibility of a central bank digital currency (CBDC), which could be used for retail or wholesale purposes – digital versions of banknotes.

The bank said the use of CBDC could support its policy objectives like preserving public trust in money, and promoting efficiency, safety, resilience, and innovation in payment systems and financial market infrastructures.

“Our research has been looking at different potential uses, assessing the potential benefits, risks and challenges associated with CBDC, and looking into the design and development of a CBDC if a decision was ever made to implement one,” the RBA said.

The RBA is evaluating the viability and usability of a digital currency. PictureNCA NewsWire/Christian Gilles

Central banks around the world are investigating the concept as companies look for a way to protect government-backed funds from the advancing threat of cryptocurrency.

The RBA has started 14 pilot projects to test out real money in CBDC form, involving banks and other industry players.

The tests will be conducted in the coming months to measure the effectiveness of the currency.

CBDC will be a digital form of traditional money, and the RBA is looking at the possibility of examining it in a real-world setting.

The Reserve Bank of Australia (RBA) is currently researching the potential of introducing a ‘digital currency’ to the Australian financial system. It is expected that the new currency will be tested to evaluate how effectively it can reduce delays in international payments. Additionally, it can provide consumers with digital money without the need to go to a bank and assist small businesses with their GST paperwork.

Commonwealth Bank Australia Blockchain and digital assets managing director Sophie Gilder suggested that a Central Bank Digital Currency (CBDC) could be available worldwide within the next 7-10 years. She told the Sydney Morning Herald that “there’s not a major economy in the globe that’s not looking at what a future where there’s a CBDC could look like”.

The CBA is collaborating with ANZ to investigate how tokenisation can be used to trade nature-based assets, such as carbon credits. This would involve real-world assets that are digitally transformed. Furthermore, ANZ is considering the potential advantages that CBDCs might offer, such as a form of “digital cash” that could be used when the internet is unavailable.

RBA’s assistant governor for the financial system Brad Jones said that the pilot and research study conducted in parallel will provide industry with hands-on learning and give policymakers a better understanding of how a CBDC might benefit the Australian financial system and economy.

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