A dedicated team comprised of experts from the esteemed legal firm, Allens, has extended advisory services to the Reserve Bank of Australia (RBA) in its pioneering research endeavor pertaining to central bank digital currency (CBDC). This ambitious project encompassed the launch of a trial CBDC, conceptualized as digital ‘tokens’ and deployed on a decentralized ledger platform, with the RBA as the direct issuer.
The practical application of the pilot CBDC underwent rigorous testing by authorized market participants, spanning a diverse spectrum of use cases. The overarching objective was to gain a profound understanding of conceivable business models, potential use cases, and economic advantages. Additionally, the project sought to unearth and assess the array of operational, technical, legal, and regulatory challenges that could be intertwined with the eventual issuance of a CBDC.
Contributions from legal professionals belonging to Allens’ Banking and Finance, Financial Services Regulatory, Technology, Media, Telecommunications, and Tax divisions played a pivotal role. Their collective efforts facilitated the establishment of a robust legal framework, essential for the issuance and dissemination of the pilot CBDC. Furthermore, these experts furnished crucial guidance on the myriad legal and regulatory intricacies that formed the bedrock of this pioneering initiative.
Reflecting on the endeavor, lead Partner Yu Zhang expressed, ‘We are deeply honored to have been instrumental in a venture that has shed light on the future trajectory of currency and its potential evolution. A CBDC holds the capacity to enhance efficiency, security, resilience, and innovation across Australia’s expansive landscape of payment systems and financial market infrastructure.’
