National Australia Bank to launch AUD-backed stablecoin

National Australia Bank (NAB) — 1 of the 4 largest banks successful the state — is gearing up to motorboat a stablecoin connected the Ethereum (ETH) network, the Australian Financial Review (AFR) reported.

The stablecoin called AUDN volition beryllium backed 1:1 by Australian Dollars (AUD) held connected spot astatine NAB.

AUDN 2022 mint

The NAB archetypal minted AUDN connected the ETH blockchain successful December 2022 and burned it to region it from circulation. Rather than interval connected crypto markets, AUDN has been created for circumstantial usage cases, according to the AFR report.

The NAB is aiming to motorboat AUDN for organization clients by mid-year aft interior testing, according to the AFR report. NAB is presently investigating AUDN by transferring wealth betwixt subsidiaries and branches — banking regulators are supervising the process.

Use cases

The AUDN coin volition alteration NAB users to settee transactions connected the blockchain, focusing connected c credits and reducing the outgo of cross-border transactions.

NAB main innovation serviceman Howard Silby reportedly told the AFR that the bank’s superior absorption would beryllium to usage AUDN arsenic a colony token. With AUDN, NAB aims to determination towards “atomic” oregon instantaneous settlements from the existent 2 days.

“We surely judge determination are elements of blockchain exertion that volition signifier portion of the aboriginal of finance.”

Silby besides said that AUDN could beryllium utilized successful repurchase agreements — short-term loans successful enslaved markets — and for “green deposits” that nexus lawsuit savings to greenish loans.

Crypto adoption connected the rise

NAB is not the archetypal slope to motorboat its ain stablecoin. Australia and New Zealand Banking Group (ANZ) became the archetypal slope to motorboat its stablecoin A$DC past year. Individual Australian banks started processing their ain stablecoins aft an effort by the 4 biggest banks to jointly make an industry-wide stablecoin fell isolated successful 2022.

DigitalX, a integer plus steadfast listed connected the Australian Securities Exchange, is readying to usage AUDN, erstwhile launched, to beryllium its reserves, the AFR reported.

The Australian authorities is considering regulating cryptocurrencies, but it is unclear if stablecoins volition beryllium portion of the archetypal regulatory regime. In September 2022, a backstage member’s draught measure suggested regulating stablecoin issuers and placing disclosure requirements connected them.

The station National Australia Bank to motorboat AUD-backed stablecoin appeared archetypal connected CryptoSlate.