• Sun. Aug 14th, 2022

CBA Focuses on Central Bank Digital Currency – Finance – Software

ByHazel R. Lang

Mar 21, 2022

The Commonwealth Bank of Australia will focus its efforts on central bank digital currency in the coming year as it expands its cryptocurrency offering.

It was only last year that CBA became the first major Australian bank to allow customers to buy, sell and hold cryptocurrency assets in a pilot project, through its CommBank app in partnership with Chainalysis. and Gemini.

Speaking at the Blockchain Australia event, CBA’s Managing Director of Blockchain and Digital Assets, Sophie Gilder, said there is now “a full range of customer needs that we would like to meet, but in a measured and regular” given current government regulations.

“Things move a little slower for large institutions than for most agile institutions [that] I can see in front of me,” Gilder said.

“Our big goals for the year ahead are around programmable currency or CBDCs, huge potential there to re-do what you can do in financial services.

“I’m really excited to see this grow, I’ve been monitoring this space for a while. I wish it had been when we issued a bond on the blockchain so you had the payment rails as well.

“We were able to demonstrate that origination and distribution was much smoother, but we weren’t able to do the settlement step efficiently, which is frustrating – my track record is settling in, I’d like to see DVP [delivery versus payment] so it’s a domain.”

The bank is already part of the Reserve Bank of Australia (RBA) proof of concept, alongside NAB, Perpetual and ConsenSys Software to explore the potential use and implications of a wholesale form of CBDC using the distributed ledger technology (DLT).

Gilder said “the tokenization of all kinds of assets, real and digital” was another area “with a long way to go.”

“There are a lot of markets today that haven’t changed much in 30 years – it’s about time.

“But again, it will be a gradual change because there’s a lot of money flowing through these markets, and we need to get it right.”

Gilder added that the big bank is “expanding my team, it’s going to double in the next few months” and “significantly increasing our investment in this space” as CBA hopes to “achieve a lot this year.”

CBA has “already been watching this space for quite some time” with around 900,000 customers having already transferred money to crypto exchanges in the past two years, according to Gilder.

Since launching its cryptocurrency offering last year, Gilder said “we try to start small and make sure we’re doing it right.”

“Another unusual thing that we do, unusual for this market anyway, is that in the absence of a comprehensive regulatory environment, we use the existing regulatory framework.

“So we issued Commbank’s crypto as a regulated financial product and we did that because we want to raise the standards of disclosure, we think that’s absolutely essential for customer trust.

“It’s different in the market, but so far the feedback has been very positive…we’re looking to evolve and add additional features this calendar year.”

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