The Australian Central Bank: No Cryptocurrencies are Considered as Money in Australia!By Jun 23, 2019 2 Min Read
The Australian Central Bank – Reserve Bank of Australia (RBA) said that the volatility and scalability problems are the obstacles for mass adoption of Bitcoin in Australia, according to the paper published on its website on 20 June.
The paper highlighted that one of the benefits for Bitcoin and other cryptocurrencies are their censorship resistance, which can effectively prevent others from modifying or censoring transactions. However, the decentralized nature also raised some challenges for legal authorities who have to focus on intermediary service providers related to crypto and those using tokens for fundraising purposes rather than the central protocol itself.
As most end users of cryptocurrency need to rely on intermediaries such as cryptocurrency exchanges or crypto wallets to make transactions; it would inevitably create a need for trusting the central party to some degree, which exposed the end-users to the risk of fraud.
Although the use of stablecoin may solve the price volatility like Bitcoin, the creation of stablecoins “relies on a central body to buy and manage the assets that back the stablecoin, which means that users have to trust that central body.” The author concluded many works had been done in improving the cryptocurrencies at the cost of becoming more centralized, and it is difficult for cryptocurrencies to have a widespread adoption as long as Australian dollar remains “a reliable, low-inflation store of value, and the payments industry continues to work on the efficiency, functionality, and resilience of the Australian payments system.”
Moreover, the use of stablecoins in Australia as a payment method has been minimal. The first Australian dollar-linked stablecoins, AUDRamp was launched in September 2018. Only 137 tokens were issued, and the price has dropped to zero.
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