Australia to Completed CBDC Pilot in Q1 2023

  • The Reserve Bank of Australia is looking for industry participants to make submissions of CBDC use cases it can test during its eAUD pilot.
  • Selected use cases will be announced in December, while the actual CBDC pilot will start in January and end in April, with its results being published in the “middle of 2023”.
Sydney Opera

The famous Sydney Opera House at sunset, Sydney, Australia, 15 November 2016. Taras Vyshnya/Shutterstock

The Reserve Bank of Australia (RBA) is planning to “explore innovative use cases” for a central bank digital currency (CBDC) from the start of next year, the central bank said in a press release on 26 September.

According to the CBDC pilot white paper, the country’s central bank and the Digital Finance Cooperative Research Centre (DFCRC) — which started collaborating back in August — will begin tests of a general-purpose CBDC starting January 2023. The main purpose of the project will be to identify and understand innovative business models, use cases, benefits, risks, and operational models for a CBDC in Australia.

During the pilot, Australia’s central bank will be responsible for the issuance of the CBDC — which will be called eAUD, and denominated in Australian dollars — while the DFCRC will oversee the development and installation of the CBDC platform. Only Australian-registered entities and residents, who were invited and underwent a Know Your Customer (KYC) procedure, will be allowed to hold the new CBDC.

The pilot’s white paper also cited potential CBDC use cases that could be explored, including atomic settlement of transactions using tokenized assets, multi-party and syndicated transactions, escrowed transactions, conditional and programmable transactions, and more. Industry participants can join the pilot as case providers once approved for implementation, though they will have to “bear their own costs for the conception, design, development, implementation and piloting of use cases, if selected”.

The RBA and DFCRC are currently engaging with industry participants on the design and usage of the CBDC pilot, and the selected use cases will be announced this December according to the white paper’s timeline. The actual pilot will be conducted between January and April 2023, with the central bank expecting to publish the results of the project sometime in the “middle of 2023”.

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