According to NAB representatives cited by coindesk.com, one of the main uses of AUDN would be to allow its customers to settle transactions on blockchain technology in real-time using Australian dollars. Other potential uses for AUDN include repurchase agreements, overseas money transfers, and carbon credit trading.
As mentioned in ThePaypers Crypto Payments and Web 3.0 for Banks, Merchants, and PSPs report, stablecoins are known to be somewhat resistant to volatility, which means that users won’t experience any significant price changes when interacting with them. The prices of stablecoins are tied to a reserve asset such as the USD or gold. For example, BUSD, USD Coin (USDC), and Tether (USDT) are all backed on a 1:1 basis with the USD.
The National Australia Bank aims to launch the AUDN stablecoin in mid-2023, but it isn’t the first bank in Australia to be involved in the creation of such an asset.
In March 2022, Australia and the New Zealand Banking Group (ANZ) have teamed up with crypto custodian Fireblocks to mint a stablecoin pegged to the Australian dollar. The bank created A$DC for the Victor Smorgon Group, a large family office based in Australia that planned to use it to trade on the Melbourne-based exchange Zerocap.
Australia is looking to tighten crypto regulation in 2023
The fall of FTX has altered the crypto landscape in 2022 and beyond, and Australia is trying to keep up with this new reality by establishing a framework for the licensing and regulation of crypto service providers. According to coindesk.com, the move would also modernise Australia’s financial system and would support the development of custody and licensing settings to protect consumers.
In August 2022, the government announced that it would rely on token mapping in order to assess which tokens or digital assets should be regulated by financial services laws. Token mapping essentially involves uncovering the characteristics of all digital asset tokens in Australia, including the type of crypto asset, its code, and other tech features that might be relevant.
The strategic plan for the payments system of Australia comprises a framework for the licensing and regulation of crypto service providers. There is a consultation paper concerning this framework that will receive feedback until 6 February 2023. The paper includes several topics related to the crypto ecosystem, including central bank digital currencies, stablecoins, digital assets, and crypto wallets.
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