RBA and Treasury Joint Paper on Central Bank Digital Currency and the Future of Digital Money in Australia
The Reserve Bank of Australia (RBA) and Treasury today released a report summarising research to date on central bank digital currency (CBDC) and how this has informed the RBA and Treasurys current assessment of CBDC issues in Australia. The report also sets out a three-year roadmap for future work on digital money in Australia.
The report concludes that a clear public interest case to issue a retail CBDC has yet to emerge in Australia. This assessment is partly informed by the observation that Australians are generally well served by the capabilities and resilience of the current retail payments system. In jurisdictions that have issued a retail CBDC or indicated that it is quite possible in coming years, the main motivations have less resonance in Australia. Nonetheless, the RBA and Treasury remain open to the possibility that this assessment could change over time as potential benefits and costs are better understood, both internationally and in a domestic context.
The report also highlights the role that a wholesale CBDC, alongside other forms of digital money and infrastructure upgrades, could play in enhancing the functioning of wholesale markets in Australia.
Brad Jones, Assistant Governor (Financial System) at the RBA said, the RBA is making a strategic commitment to prioritise its work agenda on wholesale digital money and infrastructure – including wholesale CBDC. At the present time, we assess the potential benefits as more promising, and the challenges less problematic, for wholesale CBDC compared to a retail CBDC. Next month, we will launch the public phase of Project Acacia, which will explore opportunities to uplift the efficiency, transparency and resilience of wholesale markets through tokenisation and new settlement infrastructure. This initiative will form part of a larger effort to step up our engagement with industry and other stakeholders on the question of how our monetary arrangements could better support the Australian economy in the digital age.