Top Australian Bank to Mint Stablecoin for International Payments

The National Bank of Australia (NAB), a prominent financial institution in Australia, has announced that it would launch a stablecoin pegged to the country’s fiat currency. 

Faster, More Reliable Cross-Border Payments

In an announcement shared earlier this week with the Australian Financial Review (AFR), the “Big Four” Aussie bank confirmed that its asset will be pegged to the Australian dollar and is set to launch sometime in the middle of the year. The NAB explained that its asset – tagged AUDN – will streamline the cross-border remittance process and provide a more efficient way to trade carbon credits.

Speaking with the news medium, NAB chief innovation officer Howard Silby explained that the decision to launch the asset was based on their belief that blockchain technology will have a significant role to play in the next evolution of digital finance. He explained that blockchain’s potential to deliver quick, transparent, and inclusive financial outcomes makes it a vital tool in the push for a better and more effective financial landscape. 

With AUDN, the NAB is now looking to provide real-time, reliable cross-border remittances that allow customers to circumvent traditional money transfer methods such as the Society for Worldwide Interbank Financial Telecommunications (SWIFT). Silby added that the asset would also be useful for trading carbon credits and other tokenized real-world assets. The NAB also plans to offer stablecoins in different currencies, representing countries where the bank is licensed to operate. 

One Player at a Time 

The prospect of cryptocurrencies trouncing traditional money transfer methods has always been exciting. With the SWIFT system especially coming under scrutiny for being slow and expensive to operate, many have looked into the prospect of cryptocurrencies serving as the new medium for international remittances and transactions. 

Of course, this won’t happen until much of the developed world adopts crypto for this purpose. However, considering that more countries are working towards central bank digital currencies (CBDCs) and adopting stablecoins for remittances, there is the ever-present possibility that we could see a crypto revolution when it comes to payment innovation. 

Interestingly, the NAB isn’t the only bank in the region looking to move to the crypto standard. Last March, ANZ Group Holdings, a financial holding company serving Australia and New Zealand, became the first financial institution in the region to launch a stablecoin backed by the Australian dollar. 

The digital asset, A$DC, was a joint project between the bank and local regulators, including the Australian Transaction Reports and Analysis Centre (AUSTRAC) and the Australian Prudential Regulation Authority (APRA). When it was announced, the AFR already reported that the bank had run a pilot transaction that saw institutional partner Victor Smorgon Group send 30 million AUD worth of the token to Zerocap – an Australian digital asset fund manager that also participated in the launch of the token. 

A$DC was built on the Ethereum blockchain, with additional development help coming from top crypto and blockchain industry names such as Fireblocks, Chainalysis, and OpenZeppelin.