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Australian bank to issue stablecoin
Australia’s largest bank, National Australia Bank, plans to issue a stablecoin. The Australian Financial Review reported on the 18th.
The stablecoin, AUDN, will be issued on the Ethereum (ETH) and Algorand (ALGO) networks and will be backed 1:1 by the bank’s Australian dollar. .
AUDN also enables real-time payments, and National Australia Bank aims to launch carbon credit trading, remittances, etc. with AUDN in 2023.
“Blockchain technology has elements that will form part of the future financial system,” said Howard Silvie, chief innovation officer at the bank. Blockchain technology has the potential to bring immediacy and high transparency to finance.
Silvie continued that carbon credit trading and tokenization of real assets will also be major use cases for the AUDN stablecoin. He also plans to issue stablecoins in multiple currencies, not just Australian dollars.
What are carbon credits?
Also called carbon credits. A system that allows companies to reduce their greenhouse gas emissions, issue credits (emissions credits) for that amount, and trade them between companies.
Cryptocurrency Glossary
“A$DC”
National Australia Bank will be the second Australian bank to issue a stablecoin. In 2022, the Australia New Zealand Bank issued a stablecoin pegged to the Australian dollar, A$DC.
The bank offers stablecoin trading for its client Victor Smorgon Group. Zerocap, a digital asset management company, has been paid “A$DC”. In this transaction, 2.7 billion yen (30 million Australian dollars) worth of “A$DC” was issued and remitted, and was eventually exchanged for legal tender.
The deal was made in close collaboration with blockchain analytics firm Chainalysis and DeFi (decentralized finance) firm OpenZeppelin.
Australia New Zealand Bank said at the time:
Today, much of the digital asset trading is done through offshore cryptocurrencies like USD Coin (USDC), which can be a complicated process.
Investors will first obtain Australian dollars, use a third party to convert them into cryptocurrencies (such as USDC), and then execute instructions on assets.
The bank added that using an AUD-denominated stablecoin eliminates the exchange rate risk and transaction process that comes with using USD-denominated coins.
In Australia, a central bank digital currency (CBDC) is also in the pilot stage.
Australia New Zealand Bank said private bank stablecoins and CBDCs could coexist. While CBDC is currently focused on retail payment applications, A$DC will be primarily tailored to the needs of corporate customers.
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