Commbank, ANZ Join RBA To Test 14 Use Cases of a Digital Australian Dollar

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RBA pilot: Two of Australia’s largest banks, Commonwealth Bank (CBA) and ANZ, have joined the Reserve Bank of Australia’s (RBA) pilot program to explore use cases and assess the benefits of an Australian digital dollar, also known as a central bank digital currency (CBDC).

CBA and ANZ will work alongside 12 other financial institutions, including smaller fintech and payments companies to begin testing Australia’s first real digital dollar dubbed the ‘eAUD’. In short, the eAUD is a digital version of the Australian dollar, with the RBA saying the currency being tested in the program will be a “real-claim” on the central bank.

What is a CBDC?

CBDC, or digital dollar, is a blockchain-based digital form of currency issued and regulated by a central bank. They are similar to cryptocurrencies but the value is fixed by the central bank and equivalent to a country’s fiat currency.

In a joint statement from the Reserve Bank of Australia and the Digital Finance Cooperative Research Centre, RBA Assistant Governor Brad Jones said the program will achieve two primary goals.

“It will contribute to hands-on learning by industry, and it will add to policymakers’ understanding of how a CBDC could potentially benefit the Australian financial system and economy,” he said.

The pilot project will officially launch on March 31 and finish on May 31. A final report on the program, including an assessment on the effectiveness of the cases is scheduled to be published June 30.

The use cases being piloted include offline payments, trading digital assets, tax automation, trading foreign exchange services on blockchain-based systems and settling corporate bonds.

A notable addition on the list includes the testing an interoperable CBDC for “trusted Web3 commerce,” which will be led by international payment giant Mastercard and Australian-based banking firm Cuscal.

The 14 financial institutions involved in the RBA’s pilot program.

RBA pilot

Today’s announcement marks the sixth stage of the RBA’s overall research plan for digital currencies and officially places Australia among the first movers in the global economy when it comes to CBDCs.

The Australian CBDC Project timeline via RBA white paper.

A growing number of central banks from around the world, including countries such as the UK, Canada, Brazil and Mexico are all in the process of exploring how government-issued digital cash can be used for trade in the emerging blockchain-based economy.

Mark Monfort, the Director of Australian Web3 Venture Studio Not Centralised told The Chainsaw that being selected as part of the pilot program was a major step forward for figuring out how blockchain technology can improve archaic segments of the Australian economy.

“We’re proud to be part of the pioneering group that will evolve how financial system could work and the potential this has to deliver more economic opportunities for Australians,” Monfort said.

“Our project use case involves the improvement of opaque construction supply chain workflows via the use of escrows and controllable payments. We are working on this with real clients and are excited to see this come to life.”Mark Monfort.

RBA pilot: Australia paves the way for digital dollars

Commonwealth Bank’s Managing Director of Blockchain and Digital Assets, Sophie Gilder said today that there are two primary areas that the bank is looking forward to experimenting with.

“Two areas where we see the most potential are real asset tokenisation and smart payments, and we have chosen to explore use cases in those domains. Our focus on sustainability, productivity and emerging technologies aligns to the goals of the RBA and other industry participants,” Gilder said.

“While it will take some time to assess the exact roles that blockchain and specifically a CBDC will play in the future of the financial system, it is essential that Australia continues to build our capabilities in this key area of finance and explore the possibilities of emerging technologies,” Gilder added.

In May last year, ANZ became the first Australian bank to launch a AUD-based digital stablecoin, dubbed the ‘A$DC’.

The National Australia Bank (NAB) is the most recent bank to join the blockchain frenzy, introduced its own ‘AUDN’ stablecoin on January 19 this year. The AUDN stablecoin is built on the Ethereum network.

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Mark
Monfort

Mark drives innovation with his deep understanding of AI, blockchain, and data technologies. His experience spans over 15 years of contributions to finance, technology, and operational strategy across Australia, Europe, and North America.

In 2021, he transitioned from Head of Data and Technology at a leading Australian accounting firm to startups. Prior to this, he worked in equity and macroeconomic research in the capital markets space.

Mark brings a passion for data and insights to NotCentralised. His understanding of AI and blockchain technology is central to the development of workplace productivity and financial system modernisation products, including SIKE and Layer-C. Mark’s dynamic and solutions-focused methods enable the navigation of complex technological landscapes and new market potentials.

Mark holds an Executive Master’s and a Bachelor of Commerce. He led the creation of the Australian DeFi Association and serves on the advisory board for the Data Science and AI Association of Australia. His commitment to such communities demonstrates his enthusiasm for emerging technologies and vision of positive change through technology adoption.

Nick
Bishop

Nick spearheads product strategy and institutional business development, leveraging a rich background spanning 23 years in capital markets and financial services across the UK, the US, and APAC.

In 2020, Nick transitioned into startups, bringing extensive experience in asset management and corporate advisory from roles including Director, Head of Australian Fixed Income at Abrdn and Managing Director, Head of Corporate Credit at Gresham Partners. His expertise extends to client management across the government and private sectors.

With a First Class degree in Law and Criminology and Chartered Financial Analyst experience since 2002, Nick is known for his energetic and creative approach, quickly appraising business models and identifying market opportunities.

Beyond his role at NotCentralised, Nick actively contributes to multiple startups and SMEs, holding various Board and advisory positions and applying his institutional expertise to early-stage ventures. Nick is fascinated by emerging technologies with significant societal impact and loves to immerse himself in nature.

Arturo
Rodriguez

Arturo leads product development and software engineering, applying over two decades of experience in technology, capital markets, and data science. With his years of programming expertise, Arturo smoothly transitioned into blockchain, AI, and machine learning.

Arturo has built and sold technology startups across Europe, following quant derivatives roles in global investment banks. His prior experience includes data projects for the NHS in the UK, Strategic Technology Advisor at Land Insight, and Senior Advisor to OpenInsight, where he built predictive models for vessel usage in commodity markets.

A mathematics and statistics graduate from Stockholm University, Arturo’s early grounding in logic problems and data manipulation techniques is evident in his practical applications. His work building equity derivative pricing models for Merrill Lynch and Royal Bank of Scotland showcased Arturo’s highly specialised skillset.

Arturo relocated from London to Australia in 2020. Beyond NotCentralised, his passion for technology and industry involvement extends to the Australian DeFi Association, which he co-founded, and regular contributions to the Data Science and AI Association.