- The Reserve Bank of Australia published its whitepaper on September 26. for the creation of its CBDC, the eAUD.
- The government will work closely with the Digital Finance Cooperative Research Center (DFCRC) for the creation of its CBDC.
- The eAUD, a currency worth $0.65 cents compared to the US dollar, will run on the Ethereum blockchain.
Cryptocurrencies came to change the economies of the world and it is clear that cryptocurrencies are much more than Bitcoin. An example of this are centralized digital assets, regulated and launched by the countries themselves, a trend to which more and more countries and Australia is one of those after its Central Bank Digital Currency (CBDC).
The Reserve Bank of Australia (RBA), a territory with a population of 25 million inhabitants and one of the most important GDPs in the world, published its whitepaper on September 26. This white paper works as a basis and guidelines for the next.
According to the publication, the government will work closely with the Digital Finance Cooperative Research Center (DFCRC)a research program that is also financed by the Australian authorities, for the creation of its CBDC.
As published CryptoSlate“the objective of the pilot project is to explore innovative use cases, both retail and wholesale, and business models that could benefit from a CBDC”.
Australian CBDCs
The eAUD, a currency worth $0.65 cents compared to the US dollar, will run on the Ethereum blockchain. According to the Whitepaper, the project began work in July and it is estimated that it will be completed by the same time in 2023. At that time a balance will have to be made.
“The DFCRC will provide the platform for the CBDC, while the RBA will handle the issuance and redemption of the pilot CBDC, as well as providing regulatory oversight. This main platform will be in charge of the management and monitoring of the pilot CBDC”authorities added.
According to the whitepaper published by the authorities, “Participants will be responsible for Know Your Customer (KYC) checks of CBDC end users”, while no “code or smart contract” on the platform. This is one of the most interesting points that the Ethereum chain highlights.
Australia changes its mind on crypto
Australia’s approach to a CBDC signifies a change in policy and stance from early thoughts. In 2020, during the height of the post-Covid-19 digital asset boom, the RBA did not see a reason to pursue such a project.
However, this was quickly proven. The RBA participated in Project Atom, along with the Commonwealth Bank of Australia (CBA), the National Australia Bank (NAB), Perpetual and ConsenSys, seeing the benefits.
“The RBA also participated in the Dunbar Project with the Bank for International Settlements (BIS) Innovation Center and other central banks. The Dunbar Project indicated that CBDCs can reduce the cost and processing time of cross-border transactions.”, CryptoSlate added.
How many countries are behind a CBDC?
Australia is not the first country to carry out a project of this magnitude and the study of Atlantic Council reveals that there are already 98 who are investigating their own digital currency. Among them are Mexico, the United States and Brazil, which has a much more advanced design.
Of those 98, there are 11 that have already launched the CBDC: among which the Bahamas, Jamaica and Nigeria stand out. Meanwhile, there are 15 who are in a pilot test. Russia, South Africa, China, Thailand and Saudi Arabia fall into this group.
Australia can serve as an example for the rest of Oceania and show that its use is real.
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