National Australia Bank (NAB) is ready to grow to be the second âBig 4â Australian bank to launch an Australian dollar-pegged stablecoin on the Ethereum community.
Set to launch someday in mid-2023, the AUDN stablecoin is aimed toward streamlining cross-border remittances and carbon credit score trading, in response to a Jan. 18 report from the Australian Financial Review (AFR).
NABâs chief innovation officer Howard Silby stated the choice to mint the AUDN stablecoin on Ethereum â which is backed 1:1 by the Australian greenback (AUD) â was based mostly on their perception that blockchain infrastructure will play a key position within the subsequent evolution of finance:
We definitely consider there are components of blockchain know-how that can type a part of the way forward for finance […] From our viewpoint, we see [blockchain] has the potential to ship instantaneous, clear, inclusive, monetary outcomes.â
The implementation of AUDN for real-time, cross-border remittances might grow to be a means for clients to sidestep the slower and extra pricey SWIFT fee community.
Carbon credit score trading and different types of tokenzied real-world property may also be a significant use case for the AUDN, Silby stated. He additionally added that theyâre planning to supply stablecoins in âmultiple currenciesâ the place the bank has licenses.
NABâs announcement of the AUDN comes 9 months after rival bank Australia and New Zealand Banking Group (ANZ) launched 30 million tokens of its personal stablecoin tickered A$DC in March 2022, which can be used for worldwide remittances and carbon trading.
Prior to ANZ and NABâs stablecoin initiatives, the 2 banks initially deliberate on teaming up with the opposite two âBig 4â Australian banks â Commonwealth Bank of Australia (CBA) and Westpac â to co-launch a nationwide stablecoin backed by the AUD.
However, it failed as a result of competitors considerations and the banks being at completely different phases of their adoption and technique, the AFR defined.
Jonathon Miller, Australiaâs managing director of crypto alternate Kraken Australia advised Cointelegraph that banks are starting to acknowledge the technical benefits that blockchain infrastructure presents over conventional legacy methods:
âThe persistent adoption of crypto technology by financial institutions like ANZ and now NAB for its potential to create significant efficiencies in the financial system […] is an explicit recognition of [blockchainâs] competitive advantage over traditional payment systems.â
âWe expect this trend to continue, inevitably evolving to include the adoption of various other cryptocurrencies and tokens for increasing use cases in the Australian economy,â he added.
Related: Stablecoin framework is a near-term precedence for Aussie regulators
It additionally stays to be seen how these personal bank-issued stablecoins would work in tandem with the Reserve Bank of Australiaâs eAUD â a central bank digital forex (CBDC) â which is at the moment in its pilot section.
However, NAB is assured the 2 will have the ability to function concurrently and have their very own set of distinctive use circumstances.