Australia’s central bank launches project on digital currency

The aim of the project is to look at the potential use and implications of a wholesale form of central bank digital currency

The Reserve Bank of Australia (RBA) is launching a project to look at the potential use and implications of a wholesale form of central bank digital currency (CBDC) using distributed ledger technology (DLT).

In a statement, Australia’s central bank said the project will involve the development of a “proof-of-concept for the issuance of a tokenised form of CBDC that can be used by wholesale market participants for the funding, settlement and repayment of a tokenised syndicated loan”.

The CBDC  project will be based on an Ethereum-based DLT platform.

The aim of the project is to explore the implications of a CBDC for “efficiency, risk management and innovation” in wholesale financial market transactions, the bank said.

The project is expected to be completed around the end of 2020 and the parties intend to publish a report on the project and its main findings during the first half of 2021.

The RBA will be partnering with Commonwealth Bank, National Australia Bank, Perpetual and ConsenSys Software, a blockchain technology company, on the project.

FURTHER READING: Canada calls for digital currency cooperation

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