Australia’s central bank identifies CBDC use cases as it prepares pilot launch

Dylan Butts

1 year ago

Australian dollars and nano wallet on the desk

The Reserve Bank of Australia (RBA) has outlined potential use cases and providers for a central bank digital currency (CBDC), with a pilot program to be launched in the coming months, according to a whitepaper published by the regulator on Thursday.

Fast facts

This report is a follow-up to a collaborative research project with the Digital Finance Cooperative Research Centre, exploring the possible use cases of a CBDC and its benefits to the Australian economy.
Launched in September 2022, the CBDC research project involved the submission of potential CBDC use cases by a range of participants from various industries, of which only a few were chosen to participate in the CBDC live pilot.
Fourteen CBDC use cases were selected in the report, including offline payments, nature-based asset trading, corporate bond settlement, construction payments, and livestock auctioning.
Another 14 CBDC providers, consisting of small fintech firms to large financial institutions, were identified, such as payment giant Mastercard, the Australian Bond Exchange, and Australia-based banking and financial services company ANZ.
RBA also announced that Australia intends to launch its CBDC “live pilot” in the coming months, though no precise start date was given.
About the CBDC pilot, RBA Assistant Governor Brad Jones said 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.”
More than half of the world’s central banks were developing or testing digital currencies, as of 2021, according to a May 2022 report from the Bank for International Settlements. Attention on CBDCs has continued into 2023, with the U.K. announcing a CBDC roadmap and Russia announcing a CBDC pilot program in February, according to local news reports.