- Novatti Group and AUDD are participating in a research project to explore the potential use cases and economic benefits of a central bank digital currency (CBDC) in Australia.
- Novatti will issue a supplementary stablecoin, known as eAUDD, which will be backed 1:1 by Pilot CBDC issued by the Reserve Bank of Australia and run on the Stellar blockchain.
Novatti Group (ASX:NOV) and AUDD are part of a limited-scale CBDC pilot led by the Digital Finance Cooperative Research Centre (DFCRC) and the Reserve Bank of Australia (RBA). The pilot will explore the potential use cases and economic benefits of a central bank digital currency (CBDC) in Australia.
Novatti will issue a supplementary stablecoin called eAUDD, which will be backed 1:1 by Pilot CBDC issued by the RBA and allow customers to independently verify the reserve.
eAUDD Pilot and Potential Economic Benefits
An invite-only group of participants will be able to obtain eAUDD on the Stellar blockchain, where it will be used to purchase a non-fungible token (NFT) in order to make a charitable donation. The outcomes of the eAUDD pilot will indicate whether a stablecoin with 1:1 backing by a CBDC could lead to greater customer confidence in the validity of stablecoins.
A wider acceptance of stablecoins could also lead to safeguards in bank regulation, secure payments and improved financial stability for users.
CEO of Novatti Group Excited About CBDC Trial
Peter Cook, CEO of Novatti Group, is excited about the 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. The CBDC pilot is expected to finish at the end of May with results published mid-year.
Potential Danger for Cryptocurrencies
The participation of Novatti Group and AUDD in the CBDC pilot in Australia highlights the growing interest of central banks in exploring the potential of digital currencies. While this may be a positive development for the overall adoption of digital currencies, it can also pose a big danger for cryptocurrencies like Ripple and XRP, which face regulatory challenges and uncertainty in their status as a commodity or security.
As central banks explore the potential of digital currencies, it remains to be seen how this will impact the future of cryptocurrencies.