Australia’s Central Bank Prioritizes Wholesale CBDC Over Retail, Citing Greater Economic Benefits

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Australia’s central bank has decided to prioritize the development of a wholesale central bank digital currency (CBDC), citing its greater economic benefits over a retail version.

At a conference, Brad Jones, Assistant Governor at the Reserve Bank of Australia (RBA), announced Project Acacia’s launch. It is a three-year collaboration with the Treasury to explore digital currency.

The project builds on last year’s CBDC pilot. It will focus on improving the efficiency, transparency and wholesale markets’ resilience using tokenized money and new settlement systems. Jones mentioned that future phases might involve working with regional central banks on cross-border applications.

Speech by Brad Jones, Assistant Governor (Financial System), at the Intersekt Conference in Melbourne – 'Financial Innovation and the Future of CBDC in Australia’: https://t.co/zuYTeslJhZ pic.twitter.com/3ndAbgjepq

In October, the RBA and its research partners will release a consultation paper to gather industry feedback.

The policymaker also announced the creation of CBDC advisory forums for industry and academia. These forums will launch in early 2025. They will address both retail and wholesale CBDC issues.

“We have benefited significantly from engagement with industry and the academic community on various CBDC issues over recent years, and we now seek to put more structure around this dialogue,” he said. “These forums would play a similar role to those the RBA has convened in recent years with economists from industry and academia, to hear different views on monetary policy issues.”

Next year, a third initiative will build