The Reserve Bank of Australia has shifted its stance on tokenisation as its Project Acacia concludes, with the debate now centred on how \u2013 not whether \u2013 it will integrate into the financial system.<\/p>\n
Speaking at the Australian Payments Plus \u2018Beyond Tomorrow\u2019 forum, RBA assistant governor Brad Jones pointed to strong industry engagement through its Project Acacia.<\/p>\n
Findings from this report, which explored how tokenised assets and money could improve wholesale markets, are expected to be released next month.<\/p>\n
\u201cThe intensity of industry engagement in the project revealed to us a strong and growing appetite to explore how the potential of tokenised asset markets could be realised, including through more creative use of market infrastructure,\u201d he said.<\/p>\n
Project Acacia revealed strong industry interest in tokenising fixed income assets, particularly government bonds, reflecting global trends and their key role as safe assets and benchmarks for other credit instruments.<\/p>\n
Jones said the experiment found that co-locating tokenised assets and money on the same ledger could deliver major efficiency gains, though near-term solutions may use separate ledgers with synchronisation bridges.<\/p>\n
\u201cThe project revealed growing industry interest in the issuance of tokenised private money \u2013 stablecoins and bank deposit tokens \u2026 One possibility in the years ahead is that stablecoins and bank deposit tokens have complementary roles: stablecoins playing a niche role in settlement for smaller greenfield tokenised markets, and bank deposit tokens having a more prominent role in larger markets.\u201d<\/p>\n
He added tokenisation could also broaden investor access and unlock new funding channels.<\/p>\n
\u201cThe programmability of tokenised assets and money also opened up opportunities to introduce advanced functionality in financial products and services that would be difficult or impossible to achieve with conventional forms of money and infrastructure.\u201d<\/p>\n
Digital Finance Cooperative Research Centre (DFCRC) analysis, which produced Project Acacia together with the RBA, estimates the opportunity sits around $24 billion annually, with further upside from new markets.<\/p>\n
\u201cSeismic innovation in the way that assets and money move through the global financial system occurs rarely,\u201d Jones said.<\/p>\n
He said the key question is whether tokenisation is an epoch-defining shift or an incremental evolution.<\/p>\n
\u201cIn this debate, it is important to recognise that tokenisation does not transform the economics of underlying real-world claims. It is simply a process whereby money and assets are represented as digital tokens that can be stored, traded and transferred on programmable platforms, enabling them to interact in new ways,\u201d he said.<\/p>\n
The RBA is now focused on how to realise these benefits while maintaining stability.<\/p>\n
\u201cWe have now seen enough to warrant intensified focus on how some of the potential benefits might be realised, consistent with system-wide stability.\u201d<\/p>\n
However, structural barriers remain.<\/p>\n
\u201cAs much as Project Acacia has revealed strong industry interest in tokenised finance, a range of factors have stymied dynamism in our wholesale markets to date: a lack of competitive tension reflecting entrenched network effects; risk aversion, partly reflecting perceived legal and regulatory uncertainty; and co-ordination failures that have made strategic planning difficult.\u201d<\/p>\n
Jones said addressing these challenges will require co-ordinated action across industry and government.<\/p>\n
\u201cThe co-ordination challenges are very real. Unleashing more dynamism in Australia\u2019s financial economy, enhancing our attractiveness as a destination for capital in the digitalising global economy, and strengthening our sovereign resilience at the same time, is likely to require a Team Australia effort. This will require all stakeholders to approach things differently,\u201d he said.<\/p>\n
He also highlighted accelerating global momentum with daily activity in tokenised repo markets in the United States now approaching US$400 billion and the US Securities and Exchange Commission\u2019s recent rule change allowing the Nasdaq to facilitate trading of tokenised equities.<\/p>\n
The RBA is now working with regulators and industry on next steps, including a potential digital market infrastructure sandbox.<\/p>\n
Industry reacts
Calastone\u2019s Marsha Lee said a critical takeaway from Project Acacia is the role of digital cash in enabling real-time, or \u201catomic\u201d, settlement.<\/p>\n
\u201cTraditional fiat rails are not designed for this, so interoperability between fiat and digital forms of money will be essential to unlocking the full efficiency benefits of tokenisation and supporting broader adoption,\u201d she told Investor Daily.<\/p>\n
Lee added Australia has the potential to become a regional hub, but only if it moves beyond pilot programs.<\/p>\n
\u201cFor Australia to position itself as a regional hub, it will need to move beyond pilots into broader commercial adoption by regulated institutions and build meaningful assets under management in tokenised structures,\u201d she told Investor Daily.<\/p>\n
\u201cThe opportunity now is to build on this momentum \u2013 accelerating adoption, scaling real-world use cases and ensuring the market remains competitive in attracting global capital and innovation.\u201d
Recent US developments mark a turning point, she said.<\/p>\n
\u201cFor asset managers, it indicates tokenised securities can operate alongside traditional instruments within regulated environments, which will accelerate institutional adoption and shift sentiment from \u201cwait and see\u201d to active implementation,\u201d she told Investor Daily.<\/p>\n
As more real-world use cases emerge internationally, Lee believes it reduces perceived risk and strengthens the business case for adoption.<\/p>\n
\u201cWe are also seeing the tokenisation ecosystem expand beyond funds into underlying assets such as equities \u2013 a sign this is becoming a full market evolution rather than a niche use case. As a result, the ability to tokenise funds and assets is increasingly becoming table stakes for global asset managers,\u201d she said.<\/p>\n
CloudTech said the key moment for tokenisation in Australia will be when the industry can readily offer tokenised ASX shares and other traditional finance products, such as money market funds.<\/p>\n
\u201cWhen these are commonplace amongst investors, that will be a key moment for the industry,\u201d CFO and executive director Mandy Jiang said.<\/p>\n
AUDC CEO Effie Dimitropoulos added co-ordination \u2013 not sequencing \u2013 is the key issue.<\/p>\n
\u201cRegulators play a critical role in providing clarity and reducing uncertainty, but progress will come from banks, fintechs, and digital asset providers all moving in the same direction.\u201d<\/p>\n
Dimitropoulos said regulatory uncertainty \u2013 particularly around how digital assets are classified \u2013 remains a key barrier.<\/p>\n
\u201cAs an example, without certainty on how stablecoins are treated, ie. whether as stored value, deposits, or a distinct category, institutions face ambiguity around licensing, custody, and consumer protections. This lack of clarity hinders adoption and reduces the likelihood of widespread use.\u201d<\/p>\n
Tokenisation is not a distant concept, Crypto.com warned, welcoming the RBA\u2019s remarks on Project Acacia.<\/p>\n
\u201cIt is becoming an integral part of the financial mainstream, and real-world assets will be at the centre of that shift,\u201d general manager for Australia Vakul Talwar said.<\/p>\n","protected":false},"excerpt":{"rendered":"The Reserve Bank of Australia has shifted its stance on tokenisation as its Project Acacia concludes, with the…\n","protected":false},"author":2,"featured_media":522183,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[64,260376,63,278310,13996,240432,44,7054,14000,278311],"class_list":["post-565306","post","type-post","status-publish","format-standard","has-post-thumbnail","category-australia","tag-au","tag-audc","tag-australia","tag-calastone","tag-crypto","tag-crypto-com","tag-news","tag-rba","tag-stablecoins","tag-tokensation"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/565306","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=565306"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/565306\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/522183"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=565306"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=565306"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=565306"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}