Several countries have planned to explore stablecoins despite initial reluctance and the more recent implosion of Terra. The latest to jump on the bandwagon is one of Australia’s four largest financial institutions, the National Australia Bank (NAB).
The new Australian dollar-pegged stablecoin created by NAB, dubbed AUDN, is set to launch on the Ethereum and Algorand blockchain networks. It is expected to be completed by mid-2023.
Second Australian Stablecoin Initiative
According to Australian Financial Review (AFR) report, the AUDN will allow users to settle transactions on blockchain technology in real time using Australian dollars. The NAB also said that the stablecoin is designed to serve multiple purposes, such as trading carbon credits, cross-border money transfers, and repurchase agreements. Additionally, the bank will be responsible for holding the Australian fiat-backed stablecoin.
In a statement, NAB Chief Innovation Officer Howard Silby reportedly said:
“We certainly believe there are elements of blockchain technology that will be part of the future of finance (…) From our perspective, we see (blockchain) has the potential to deliver instant financial results , transparent and inclusive.”
The current infrastructure for overseas transactions is dominated by the SWIFT network, which is undoubtedly a legacy system. However, the launch of AUDN could be an effective alternative for many users.
The development comes four months after Australian Senator Andrew Bragg penned a bill to put the national cryptocurrency industry under strict scrutiny. The bill required digital asset exchanges and stablecoin issuers to reveal their operations to authorities. It also targeted Chinese banks dealing with digital yuan in the country.
Other Countries Dabbling in Stablecoins
With the creation of AUDN, NAB became the second major bank in the country to launch an Australian dollar-pegged stablecoin on the Ethereum network. Last year, Australia and New Zealand Banking Group (ANZ) struck an Australian fiat-pegged stablecoin in collaboration with crypto custodian Fireblocks.
This week, Russia and Iran are said to have engaged in talks on launching a new gold-backed cryptocurrency. Alexander Brazhnikov, executive director of the Russian Cryptography and Blockchain Industry Association, claimed that the token will be developed as a stablecoin.
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