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The Reserve Bank of Australia (RBA) partners with Commonwealth Bank to research CBDC.

According to an announcement from The Reserve Bank of Australia (RBA) on November 2.2020, the financial institution is partnering with the Commonwealth Bank, National Australia Bank, Perpetual and ConsenSys Software, a blockchain technology company, on a project to explore the potential use of a wholesale form of central bank digital currency (CBDC) using distributed ledger technology (DLT).

The Reserve Bank of Australia (RBA) said the project will involve the development of a proof-of-concept (POC) for the issuance of a tokenized form of CBDC for use by wholesale market participants for the funding, settlement and repayment of a tokenized syndicated loan on an Ethereum-based DLT platform. The RBA also mentioned the POC will be used to explore the implications of ‘atomic’ delivery-versus-payment settlement on a DLT platform, and the project will look into other potential programmability and automation features of tokenized CBDC and financial assets. 

“With this project we are aiming to explore the implications of a CBDC for efficiency, risk management and innovation in wholesale financial market transactions,” Assistant Governor of the RBA (Financial System) Michele Bullock said.

“While the case for the use of a CBDC in these markets remains an open question, we are pleased to be collaborating with industry partners to explore if there is a future role for a wholesale CBDC in the Australian payments system,” Bullock added.The central bank said the project is expected to be completed around the end of 2020 and a report will be issued on the project during the first half of 2021.

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