Australia’s CBDC Pilot Is On Track To Be Completed In 2023

On Monday 26th September, The Reserve Bank of Australia (RBA) announced that it is expecting to complete its central bank digital currency (CBDC) pilot by the middle of 2023.

According to media released published by the agency, the purpose of the pilot is to "explore innovative use cases" that could be supported by the issuance of a CBDC. The white paper, which is a document produced by the bank that can later be used to inform future laws, says that the project was also looking into regulatory considerations associated with a CBDC.

The paper did not reveal a commitment from the RBA to issue a CBDC but the bank is seeking feedback from industry participants that will "contribute to ongoing research." The experiment is expected to end in the beginning of next year with results to be published in mid-2023, according to the document.

Australia's CBDC research project kicked off in July and the pilot commenced in August. The document was published in the wake of Australian opposition politician Andrew Bragg, who was criticising the Federal Government led by Prime Minister Anthony Albanese, on its "inaction" when it came to crypto. The Albanese government has meanwhile announced it will use “token maping” as a framework for regulation.

The white paper provides additional details on the CBDC project including that Australia's pilot currency would be called eAUD, and all participants in the project will need to be invited and approved.

Australian Federal Policy Establish Crypto Division to Trace Transactions

The Australian Federal Police (AFP) has established a new cryptocurrency unit to focus on monitoring crypto-related transactions.

The use of cryptocurrency for the purpose of undertaking criminal activity has grown significantly in recent years ever since the Australian Federal Police (AFP) made its first crypto seizure in 2018.
The AFP has announced that it will be working hard to boost cryptocurrency expertise within its ranks so it can improve its ability to trace crypto transactions by setting up a dedicated police group.

The increased focus on illicit crypto transactions comes about as the AFP seized a lot more criminal assets than the authority had originally expected. In September 2022, the AFP reported that it reached its goal of seizing $600 million from financial crimes two years ahead of schedule. The target was originally set by the AFP-led Criminal Assets Confiscation Taskforce and was not predicted to be reached until 2024.

Since February 2020, the AFP has seized $380 million in residential and commercial property, $200 million in cash and bank accounts, and $35 million in cars, boats, aircraft, artworks, luxury items and cryptocurrencies. Stefan Jerga, the national manager of the AFP’s criminal asset confiscation command says that crypto seizures were small compared to “traditional” criminal assets like property and cash, but the additional focus is expected to provide more insights.

According to Stefan Jerga the environment triggered the creation of a standalone team, opposed to a lot of officers “picking up some of this skill set as part of their overall role.” Mr. Jega elaborated that the ability to trace crypto transactions across blockchains is “really, really important” alongside national security, child protection and others.

In early 2022, an official at the Australian Transaction Reports and Analysis Centre (AUSTRAC) expressed scepticism about the transparency of cryptocurrencies. AUSTRAC deputy chief executive John Moss believes that cryptocurrencies could be used anonymously, quickly and across international borders, which made them “attractive for criminals,” including neo-Nazi groups.

Many people believe that Bitcoin is anonymous, however the truth is Bitcoin transactions are definitely not anonymous.  Instead, crypto transactions are publicly trackable via blockchain explorers. Although it’s technically possible to run an anonymous Bitcoin wallet, it is becoming increasingly difficult to conduct Bitcoin transactions anonymously as transactions are quite often associated with users’ Know Your Customer data.

Australia’s CBDC Pilot Is On Track To Be Completed In 2023 <br>