Reserve bank of Australia to test CBDC

• Novatti to join the CBDC pilot test program by the Reserve Bank of Australia.
• Stellar Lumens will be featured in the pilot and harbor the

Many blockchain protocols are making impressive milestones in their respective ecosystems and Stellar Lumens (XLM) is making impressive headway in its own customized payment push. One of Stellar Lumens’ major partners Novatti has announced it has landed the approval to join the pilot test for Australia’s Central Bank Digital Currency (CBDC) project.

As announced by Novatti, the pilot test will also feature other participants like the Digital Finance Cooperative Research Centre (DFCRC) and also in conjunction with the Reserve Bank of Australia (RBA). 

As detailed, Novatti’s role will be the issuance of a stablecoin dubbed the eAUDD. This stablecoin will have its full reserve backed by the RBA and will be pegged 1:1 with the digital Australian Dollar. Based on its design, the eAUDD will empower the users to verify the reserve of the CBDC in a way that will foster transparency across the board.

The eAUDD will have some spending powers and users can make use of it to purchase a non-fungible token (NFT) in order to make a charitable donation. As explained, the focus of this test is to see whether a stablecoin pegged to a fully backed CBDC can stir and bolster customer confidence as it relates to stablecoin. 

It is not uncommon to find Central Banks around the world researching different feasibilities as it concerns CBDCs. The clamor is particularly growing due to the cheaper and faster alternative that cryptocurrencies present to the average user which largely surpasses that of fiat notes.

While many apex banks are making use of a different technology other than blockchain, there have been promises from most that user privacy will be adhered to in no small measure.

Retesting CBDC Utility Through Stellar Lumens

While CBDCs are essentially an affair of the Central Banks, many are drawing the support of private industry players to help expand the scope of their research.

One of the ways to get this done is to onboard tech companies, especially those with a focus on payments like Novatti. These private partners can best help the banks to test the utilities of their CBDCs in a way that can offer a real-world use case that can better resonate with consumers already familiar with cryptocurrencies.

Here is where Stellar Lumens comes in to boost the role of Novatti in its cooperation with the RBA.

“We are very excited to be selected for this first-of-its-kind opportunity to help shape the future of CBDCs and promote the use cases for high governance stablecoins in Australia.  Novatti’s stablecoin service was created with a focus on compliance, security and utility, all of which will support the innovative CBDC trial,” said Peter Cook, CEO of Novatti Group.

Besides Stellar Lumens, Ripple Labs is also another major player with deep ties to helping Central Banks expand their CBDC research innovations.

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