The Reserve Bank of Australia (RBA) has delved into the public sentiment surrounding retail central bank digital currencies (CBDCs), examining both the willingness to utilize CBDCs in digital wallets and the potential privacy benefits they may offer. Describing its hypothetical CBDC as "a digital currency that is more secure and potentially more private than commercial bank deposits," the RBA employed discrete choice experiments to gauge the public's valuation of goods with no existing market. The study considered privacy and security options costing up to 5 Australian dollars (AUD), roughly equivalent to 3 US dollars.
The RBA highlighted the intrinsic value of CBDCs, emphasizing their lack of credit risk compared to bank deposits, which are susceptible to bank failures. Analyzing data from 2022, the RBA found that the willingness to hold an account with the RBA instead of a commercial bank was negative, indicating that individuals were willing to pay a small sum (less than a dollar per year) to avoid doing so. This suggests that Australian bank deposits are already perceived as a secure form of currency, with physical cash issued by the RBA remaining an alternative.
However, the RBA noted potential public resistance to CBDCs, which could influence the findings. The survey assumed a non-intermediary system where the RBA would directly open accounts for the public, contrasting with most active and trial CBDCs that involve intermediaries utilizing financial institutions' services. Additionally, policymakers anticipate designing an intermediary CBDC with varying privacy options, complicating the assessment of privacy preferences.
Privacy concerns further complicate the issue, as previous research indicates a high valuation of privacy among individuals, despite a tendency to forgo privacy measures in practice. The study revealed a strong preference for sharing information with the financial crime agency Australian Transaction Reports and Analysis Centre and commercial banks, indicating a value approximately AUD 5 higher than data shared with the RBA.
In summary, the study identified limited public support for retail CBDCs. While the RBA has conducted several studies on CBDCs, often yielding positive conclusions, these studies primarily focus on wholesale CBDC use cases.
