The Reserve Bank of Australia (RBA) and the Digital Finance Cooperative Research Centre (DFCRC) released a report on May 18 detailing the outcomes of Project Acacia, a joint initiative exploring how digital money and settlement innovations could support wholesale tokenised asset markets in Australia.
Project Acacia is significant as it comes amid global momentum in tokenised finance. The project examined how asset tokenisation, combined with new digital money forms and settlement systems, might improve efficiency, functionality, and resilience in Australia’s wholesale financial markets. It also identified challenges to scaling these technologies that require further analysis by regulators and industry.
Industry participants developed and tested 20 use cases for wholesale tokenised assets across various classes. These scenarios demonstrated benefits such as faster settlement, reduced counterparty risk, improved capital efficiency, and automated servicing. They also explored settling transactions using different types of public and private digital money—including traditional RBA exchange settlement account balances, a pilot wholesale central bank digital currency (wCBDC), tokenised commercial bank deposits, and stablecoins.
The report outlines a new multi-stream program to advance responsible innovation in Australia’s wholesale financial markets. This includes enhanced cooperation between industry and regulators; consideration of regulatory sandboxes for digital market infrastructure; assessment of government-issued tokenised bonds; continued work on interoperable commercial bank deposit tokens; and RBA consultation with industry about adapting its settlement infrastructure. According to the official website, the Reserve Bank of Australia serves as the country’s central bank—managing gold reserves, pursuing economic welfare goals including currency stability and full employment—and is led by Governor Michele Bullock since September 2023.
Brad Jones, Assistant Governor (Financial System) at the RBA said: “The constructive engagement between industry and public sector agencies was a foundation stone for the success of Project Acacia. It surfaced a set of common opportunities and challenges in making our financial system more dynamic and resilient through a period of intense technological disruption. The scope of future initiatives we are outlining today is ambitious – covering tokenised assets, moneyand new infrastructure arrangements –and recognises that it will take a collective effort to ensureAustralia’s financial system is well positioned for the digital age.” Professor Tālis Putniņš, Co-CEOand Chief Scientist at DFCRC said: “Project Acacia demonstrated how tokenised assets,digital moneyand new settlement infrastructure can improve the efficiencyand functioningof wholesalefinancialmarkets.This includes faster settlement,reduced counterparty risk ,improved capital efficiencyandautomatedassetservicing.Australia achieved important world firsts through ProjectAcacia ,includingthe issuanceof pilotwholesale CBDC onto bothpublicandprivatedistributedledgerinfrastructureforresearchpurposes ,demonstratingAustralia’s capabilitytoplayaleadingroleinnextgenerationoffinancialmarketinfrastructure .”
DFCRC research estimates that digital finance innovation could deliver $24 billion annually in economic gains for Australia.The opportunity nowis to buildon themomentumfromProjectAcaciabytranslatingsuccessfulexperimentationintoreal-worldadoptionthroughcontinuedcollaborationbetweenindustry ,regulators,andgovernment.
