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Reserve Bank of Australia to trial digital currency in a pilot scheme

August 09, 2022

Reserve Bank of Australia to trial digital currency in a pilot scheme
The Reserve Bank of Australia will trial its own digital currency as part of a research project to evaluate the future of Central Bank Digital Currencies (CBDC) in Australia.

Unlike well known cryptocurrencies such as Bitcoin and Ether, which were created by private entities or individuals, a CBDC is issued and controlled by the central bank just like cash and electronic stores of sovereign currency sitting in bank accounts.

The research project the RBA is undertaking in collaboration with the Digital Finance Cooperative Research Centre (DFCRC) will focus on the uses for, and potential economic benefits of, a CBDC.

“The project, which is expected to take about a year to complete, will involve the development of a limited-scale CBDC pilot that will operate in a ring-fenced environment for a period of time and is intended to involve a pilot CBDC that is a real claim on the Reserve Bank,” the RBA noted in a media release.

“Interested industry participants will be invited to develop specific use cases that demonstrate how a CBDC could be used to provide innovative and value-added payment and settlement services to households and businesses.”

RBA deputy governor Michelle Bullock said the project was “an important step” on the path to a potential Australian CBDC.

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