Reserve Bank of Australia Announces Selected CBDC Use Case Proposals

On Wednesday afternoon—or Thursday morning, according to local time—the Reserve Bank of Australia announced it had selected use cases for its central bank digital currency, as well as their providers. The country’s central bank initially revealed it is exploring CBDC use cases last August.

Australia’s Central Bank Unveils Selected CBDC Use Cases

The Reserve Bank of Australia recently announced it had selected a number of use cases, as well as their providers, that are to participate in a live pilot of the country’s central-bank digital currency—eAUD. According to the release, the central bank received numerous submissions since it announced its exploration of use cases last year.

RBA’s Assistant Governor, Brad Jones, commented that his organization is “delighted with the enthusiastic engagement by industry in this important research project”, and added that “tt has also been encouraging that the use case providers that have been invited to participate in the pilot span a wide range of entities in the Australian financial system, from smaller fintechs to large financial institutions.” Fourteen use cases have been selected for the live pilot. 

The reserve bank also offered the list of its selected use cases as well as of their providers. The list features a broad range of potential challenges, including offline payments, tokenized bills, corporate bond settlement, and livestock auction. Likewise, the providers include multiple well-known companies such as Mastercard and multiple smaller companies.

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The Global Push for CBDCs

While CBDCs have been in active development across numerous countries for years with several like e-Naira, the sand dollar, and the digital yuan getting a launch between 2018 and 2021., 2022 and 2023 have seen a notable spike in central bank activity. In fact, since January, news about the development of central-bank digital currencies came from the UK, Russia, Japan, and Spain.

In mid-January, the Bank of Spain authorized a private firm called Monei to launch a euro-linked token in a limited pilot it is reportedly hoping will become an “embryo” for the development of the digital euro. Only weeks later, the UK treasury unveiled the roadmap for its own CBDC after posting a job offer for a head of the digital pound.

In mid-February, both the Bank of Russia and the Bank of Japan announced their respective CBDC pilots with the former set to launch on April 1st. On March 1st, US’ Under Secretary for Domestic Finance Nellie Liang revealed that the FED is actively working on the technology needed for a smooth release of a digital dollar while awaiting for the policymakers to reach a decision on an American CBDC.

There is also a great deal of enthusiasm for central-bank digital currencies coming from the private sector with, for example, IBM’s Web 3.0 and Sustainability Executive Partner, Shyam Nagarajan, calling them the future of money and payments. The support is, however, not universal. In mid-February, a UK advocacy group opposed to CBDCs launched a campaign aimed at preventing the creation of the digital pound under the slogan “save privacy, stop CBDCs”.

When will the eAUD go live? Tell us what you think in the comments below.