On Thursday, Australia’s central bank announced significant progress towards developing a wholesale central bank digital currency (CBDC) in collaboration with various industry partners, marking the first time real money and assets are being utilized in projects.
The Reserve Bank of Australia (RBA) revealed its “Project Acacia,” which will explore 19 pilot cases involving actual money and assets, along with five proof-of-concept scenarios featuring simulated transactions.
These trials will cover various asset classes, such as fixed income, private markets, trade receivables, and carbon credits. The proposed settlement assets include CBDCs, stablecoins, bank deposit tokens, and innovative methods for utilizing commercial banks’ existing deposits at the RBA.
The platforms involved in the testing include Hedera, Redbelly, R3 Corda, Canvas Connect, and other compatible networks. The testing phase is set to take place over the next six months, with a report expected in the first half of the following year, according to the RBA.
Brad Jones, an assistant governor at the RBA overseeing the financial system, stated, “The selected use cases in this project will enhance our understanding of how innovations in central bank and private digital currencies, along with payment infrastructure, could improve the functioning of wholesale financial markets in Australia.”
The RBA is focusing on wholesale applications for a digital currency, having determined that there is no economic advantage to an official retail cryptocurrency.
The central bank noted that the advantages of a wholesale CBDC include minimizing counterparty and operational risks, optimizing collateral use, enhancing transparency and auditability, and lowering costs for institutions and customers.
