An official RBA report states that the DFCRC is helping them evaluate the use cases for a CBDC. The publication of a study explaining the objectives of that project will provide more detail about the approach and the primary beneficiaries.
Central bank digital currencies or CBDCs have gained increasing popularity worldwide, as many governments plan to use them against stablecoins. These include Tether (USDT), USD Coin (USDC), and Dai (DAI), which are at parity with the US dollar.
The Reserve Bank of Australia (RBA) recently announced the launch of a CBDC. However, they explained that they are still exploring the possible economic benefits of this project.
Various Companies to Help the Australian Central Bank Develop Its CBDC
A report on the official page of the RBA states that the Digital Finance Cooperative Research Centre (DFCRC) is helping the financial institution. They will work together to evaluate the use cases for a CBDC in the Oceanian country.
The RBA explained that it would take one year to develop the CBDC and expect it to provide economic benefits. However, they will conduct a pilot test involving a limited issuance and operation process under their control.
They have also requested different companies to collaborate with them in the development of the CBDC. That way, they can achieve utility models for businesses, homes, or companies, besides better legal, technical and regulatory agreements.
Andres Furche, the general director of the DFCRC, explained that there are no problems with the payment systems in Australia. Since they are relatively modern and work well, implementing a CBDC is not a matter of technical feasibility but economic benefits.
The financial institution explained that they would outline the definitive objectives of the CBDC after evaluating the results. That will allow knowing the details about the approach and the primary beneficiaries.
Around 80% of the Countries Are Interested in Digital Currencies
The Reserve Bank of Australia is not the only one with its sights on CBDCs. A PwC report published several months ago indicates that at least 80% of central banks worldwide are researching digital currencies.
China is one of the countries that has progressed most in that regard, even launching the e-yuan in 2020.
It is a matter of time before the other central banks publish their assessments. Meanwhile, many people are waiting for the results of 28 pilot programs while enjoying the existing CBDCs.
Cryptocurrencies have become increasingly relevant in the economic system worldwide. Many governments have even created regulations to control or ban them, arguing they contribute to illicit activities.
The development of CBDCs that compete with US dollar-pegged crypto assets is an action they have taken. For example, China wants to reduce the prominence of the American fiat currency with the digital yuan (e-CNY).
Meanwhile, BTC is trading at around USD 23,892 and has accumulated a 3.6% over the last week. While its daily trading volume is above USD 25.14 billion, its market capitalization is about USD 455.66 billion, according to CoinGecko.
By Alexander Salazar