– National Australia Bank (NAB) is launching a stablecoin called AUDN on the Ethereum (ETH) network.
– The stablecoin will be backed 1:1 by Australian Dollars (AUD) held on trust at NAB.
– AUDN will be used for settlement of transactions, reducing settlement time, bringing down cost of international transfers, and carbon credits.
National Australia Bank (NAB) is making moves to enter the cryptocurrency world, with plans to launch a stablecoin on the Ethereum (ETH) network. The stablecoin, called AUDN, will be backed 1:1 by Australian Dollars (AUD) held on trust at NAB.
The NAB first minted AUDN on the ETH blockchain in December 2022 and burned it to remove it from circulation. Rather than float on crypto markets, AUDN has been created for specific use cases. The NAB is aiming to launch AUDN for institutional clients by mid-year after internal testing. NAB is currently testing AUDN by transferring money between subsidiaries and branches — banking regulators are supervising the process.
The AUDN coin will enable NAB users to settle transactions on the blockchain, focusing on carbon credits and reducing the cost of cross-border transactions. NAB chief innovation officer Howard Silby reportedly told the Australian Financial Review that the bank’s primary focus would be to use AUDN as a settlement token. With AUDN, NAB aims to move towards „atomic“ or instantaneous settlements from the current two days.
The use cases for AUDN are plentiful. It will reduce settlement time, bring down the cost of international transfers, and improve carbon credits and sustainability initiatives. Silby believes AUDN will be a part of the future of finance, saying „We certainly believe there are elements of blockchain technology that will form part of the future of finance.“
NAB is currently considering various options for launching AUDN, including a private Ethereum blockchain, according to the AFR report. The bank is also looking at ways to enable the coin to be used more widely outside of the bank.
If all goes as planned, AUDN could become the first AUD-backed stablecoin on the Ethereum network. It would also be the first stablecoin launched by a major Australian bank, and could pave the way for other banks to follow suit. With AUDN, NAB is taking a bold step into the world of cryptocurrencies and blockchain technology, while at the same time creating a more efficient and secure way to transfer money.
