The Reserve Bank of Australia is calling for submissions into a proposed central bank digital currency.
In a white paper issued yesterday, the RBA said it is seeking a use case for such a cryptocurrency.
It is teaming with the Digital Finance Cooperative Research Centre, a ten-year, $180 million program jointly funded by universities, industry partners, and the Australian Government, which launched late last month.
“The project intends to test a general-purpose pilot CBDC issued as a liability of the RBA for use in real-world, pilot implementations of services offered by Australian industry participants,” the paper reads.
“Any compelling use case – whether so-called ‘wholesale’ or ‘retail’ – will be explored in the project”.
The digital coin will be named the eAUD, and be pegged to the Australian cent, with a cap to be determined by the RBA.
“No interest will be paid by the RBA on any holdings of eAUD,” the paper notes, and only Australians can hold eAUD.
“All holders of eAUD will need to be identity-validated by their use case provider or an approved KYC (know-your-customer) service provider.
“eAUD will be able to be held in both a ‘custodial’ wallet (provided by a use case provider) or a ‘noncustodial’ wallet directly by the end user.
“The eAUD platform is intended to be agnostic to the technologies and networks that use case providers use to interact with it.
“Pilot use cases may be implemented on traditional technology platforms, or public or private Distributed Ledger Technology (DLT) platforms, as may best suit the use case and provider preferences.”
Expressions of interest close in October, with use cases to be piloted by December and an end date of April 2023. Findings will be released mid-2023.
