Decision To Pursue Central Bank Digital Currency Gets Eliminated

CBDC-Ban

As of now, Australia and New Zealand have both just eliminated the decision of pursuing a central bank digital currency (CBDCs).

The head of the payments policy department of the Reserve Bank of Australia (RBA) Tony Richards mentioned in a speech on Tuesday that although his institution believes there is little demand for a CBDC, if ever people start to adopt a new e-money in numbers, there could be “significant implications for the bank’s financial stability mandate.”

As a holder of a bitcoin using it in retail transactions since 2014, Richards went on to defend that the cryptocurrency still has “structural flaws” that put restrictions on its potential.

He reemphasized RBA’s stance that issuing a central bank digital currency, an “eAUD” for that matter as the bank’s governor Philip Lowe described it in a speech, is not required within the existing financial system.

Richards stated:

“So for the time being at least, consideration of a possible new electronic form of money provided by the Reserve Bank to households is not something that we are actively pursuing. Based on our interactions with our counterparts in other countries, it is also not front of mind for most other advanced economy central banks.”

The governor of the Reserve Bank of New Zealand Geoff Bascand backed him up by claiming that a central bank-issued cryptocurrency would not be financially stable given its existing scalability limitations and lengthy transaction confirmation process.

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