© Reuters.
Investing.com – The Reserve Bank of Australia (RBA) has taken a step closer to its goal of introducing a central bank digital currency (CBDC). Together with the Digital Finance Cooperative Research Centre, a pilot project has been launched to determine whether the introduction of eAUD is a relevant issue.
This essentially involves answering three fundamental questions:
“What are the newly developed business models and use cases that a CBDC would support that are inefficiently covered by Australia’s existing payment and settlement infrastructure?
What economic benefits could issuing a CBDC in Australia bring?
What are the operational, technological, policy and regulatory issues that should be addressed when deploying a CBDC in Australia?
The pilot project uses an Ethereum-based platform, but this appears to be only a transitional solution, as no guarantees have been given that Ethereum will continue to be used in the event of a large-scale deployment.
From the perspective of established financial institutions, the development of CBDCs is problematic if they are also made available to the normal population, as explained by Matthew Mezinskis:
“Central banks will be keen to protect the banking system. They know that if deposits are taken out of banks and allowed to circulate only in a central bank’s CBDC currency, they will no longer be available for lending. . This is a big problem for banks, so we are trying to find a solution. The most common should be that there is a limit that must not be exceeded for each CBDC account.
by Marco Oehrl