Mastercard has developed new solutions for a potential pilot of an Australian Central Bank Digital Currency (CBDC) which enables its use across multiple blockchains for commerce.
In partnership with Cuscal and Mintable as part of the Reserve Bank of Australia (RBA) and DFCRC research project, the CBDC use cases aimed to increase the security and ease of use of the tokenised currency to be redeemed by verified Know Your Customer (KYC) licensed providers.
Mastercard found that in a live environment, the CBDC could enable the holder to purchase NFTs listed on the Ethereum blockchain. The process ‘locked’ the required amount of the digital currency on the RBA pilot CBDC platform and minted an equivalent amount of wrapped tokens on the Ethereum network.
Richard Wormald, Division President, Australasia at Mastercard, commented: “As the digital economy continues to mature, Mastercard has seen demand from consumers to participate in commerce across multiple blockchains, including public blockchains.
“This technology not only has the potential to drive more consumer choice, but it also unlocks new opportunities for collaboration between the public and private networks to drive genuine impact in the digital currency space.”
A prerequisite of the test transaction was that the Ethereum wallets of both the buyer and seller, as well as the NFT marketplace smart contract, were ‘allow-listed’ within the platform. With all other transfers of the wrapped pilot CBDC blocked, it successfully demonstrated the platform’s ability to implement controls on public blockchains.
Zach Burks, CEO and Founder of Mintable, said: “The vast potential of NFTs was obvious during this progressive CBDC pilot. Together with Mastercard, we have identified a use case whereby digital currencies and NFTs can easily be linked, potentially stamping out fraud and theft, ending the loss of documentation and records, and unleashing new possibilities for commerce.
“Mintology, Mintable’s B2B arm, is making NFTs more accessible and more valuable with innovative new uses. While digital currencies are in their infancy, NFTs are already being used for new media, gamification, digital identities, loyalty programs, ticketing, authentication, certification, and more.”
The pilot leveraged two pillars of the Multi Token Network, which Mastercard introduced in June 2023 as a set of capabilities designed to enable more efficient payment and commerce applications using blockchain technology.
This included Mastercard Crypto Credential which offers a set of common verification standards and infrastructure to enable trusted interactions using blockchain networks, in addition to interoperability to offer capabilities across all supported payment tokens and networks in a scalable manner.
Nathan Churchward, Domain Lead, Payments at Cuscal, added: “We were pleased to collaborate with Mastercard to test new approaches to managing settlement and liquidity risk through the CBDC pilot. It’s exciting to be able to further partner with Mastercard to support the future of banking and payments in Australia.”