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The Reserve Bank of Australia announced new partnerships to investigate CBDC

November 2, 2020

According to an announcement by the Reserve Bank of Australia on November 2, or RBA for short, The financial institution will be working with Commonwealth Bank, the National Bank of Australia, financial services company Perpetual and software company ConsenSys to investigate the possible wholesale use of a central bank digital currency in the country called “Ethereum-based Distributed Ledger Technology”.

The RBA said it would investigate developing a proof-of-concept for it “the issuance of a tokenized form of CBDC.” He specifically mentioned wholesale market participants who could use the digital currency for tokenized syndicated loans on a DLT platform and investigate the effects of delivery and payment guarantee agreements with cross-chain nuclear exchanges.

“With this project we want to examine the effects of a CDBC on efficiency, risk management and innovation in financial market transactions in wholesale.” said the Deputy Governor of the Reserve Bank of Australia, Michele Bullock.

The Reserve Bank of Australia announced new partnerships to investigate CBDC
The Reserve Bank of Australia announced new partnerships to investigate CBDC

“While the use case of a CBDC in these markets remains an open question, we look forward to working with industry partners to investigate whether there is a future role for a CBDC in wholesale in the Australian payments system.”he added.

The move is part of the RBA’s ongoing change of course on CBDC policy. On October 14, the head of payments policy of the RBA announced this The bank would continue investigating the CBDC despite the financial institution’s statement in September that there was no solid political argument for issuing one.

As an alternative to issuing a CBDC, the bank has taken note of the real-time efficiency success of the country’s New Payments Platform and has stated that it is ready to provide access fiat states “as long as the Australians want to keep using them.”

The central bank said that The project will be completed by the end of this year and will publish a report in 2021.