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RBA moves on fiat efficiency but not ready for Crypto future

Image: Mike and Wombo collaboration.

What happened at the RBA Payment Systems Board meeting?

In its latest meeting, the RBA Payment Systems Board outlined several key developments around digital payments, focusing on financial market infrastructures, cash distribution, central bank digital currencies (CBDCs), and the New Payments Platform (NPP).

While this ongoing work highlights the RBA’s commitment to ensuring Australia’s financial systems “remain modern and efficient”, it also underscores a significant gap: the shift towards cryptocurrency and the broader digital economy remains largely unexplored and virtually ignored.

So what?

Despite the rise of digital payment methods, including the RBA’s efforts to enhance the NPP, these systems remain grounded in fiat currency and traditional banking infrastructure which operates a little faster than a snail.

This is distinct from cryptocurrency, which is internet-native and built for instant, decentralised exchanges of value.

While the RBA’s work on wholesale tokenised money marks a modicum of progress, it still operates within a framework where control remains tightly held by central authorities, and digital fiat is simply an extension of physical currency rather than a departure from it.

For AI-driven businesses, which will eventually need to transact autonomously and at the speed of light, the current digital payment systems such as the NPP and digital fiat may prove insufficient.

Cryptocurrency, by contrast, offers a more seamless solution, but it remains largely unacknowledged by the RBA in terms of policy development.

Now what?

As the RBA continues to focus on enhancing digital efficiency, the question remains: Will it be ready when the economy inevitably shifts towards a future where crypto payments and AI-driven transactions become the norm?

For now, the answer is NO.

The wholesale tokenisation efforts might be seen by some as a step in the right direction, but at some point, the RBA will need to confront the broader implications of cryptocurrency and its potential to reshape the financial landscape.

For more details on the latest meeting, see the summary minutes here.

See you in the market.

Mike