Project Acacia has now tested how tokenized asset markets could establish themselves in Australia.
The Reserve Bank of Australia and the Digital Finance Cooperative Research Center have released findings from Project Acacia, a large-scale experiment that moved digital money and tokenization from policy theory to market plumbing.
The project tested 20 wholesale market applications for tokenized assets across issuance, servicing, trading and settlement, including fixed income, managed funds, repos, structured products, private markets, carbon credits and trade payables.
The key result is about money, not asset packaging. Institutions need finality, legal certainty, liquidity and operational reliability at the same time, and settlement assets determine whether tokenized rails can support real volume.
Project Acacia placed four candidates in the same frame: traditional RBA checking accounts, a pilot central bank digital currency, tokenized forms of commercial bank deposits, and stablecoins.
That makes Project Acacia a live case study for any institutional tokenization push. Tokenized markets only scale when the cash part can keep pace with the asset part without creating new settlement risk.
Project Acacia shows that the cash leg is the bottleneck
A tokenized bond, repo, fund unit or carbon credit can be traded on new rails, but the market still needs a trusted way to pay for it.
If the cash portion is outside the tokenized platform, participants will need synchronization between legacy payment systems and asset ledgers. If the money part is issued by a bank, the market needs interoperability between banks.
If the cash leg is a stablecoin, it needs credible reserves, redemption and licensing. If the cash part is central bank money, the question arises who has access to it and to what extent the central bank wants that money to function outside the existing settlement systems.
The RBA Project Acacia final report identified potential benefits across the asset lifecycle, including shorter settlement cycles, lower counterparty risk, better capital efficiency, automated maintenance and reduced operational errors.
These gains speak to institutional costs that are often hidden in retail crypto trading: reconciliation, settlement failure, collateral movement, pre-funding, custody controls, and legal finality.
The report also points out the limitations of a thesis that focuses solely on technology. Interoperability, legal and regulatory uncertainty, sector coordination, liquidity fragmentation and liquidity tied up in pre-funded transactions remain living barriers.
Tokenization may reduce some frictions, but settlement money will decide whether the new system will be a marketplace or another set of disconnected platforms.
The RBA’s materials frame the central bank’s monetary and settlement infrastructure as an anchor for tokenized wholesale asset markets, while leaving room for private digital money such as stablecoins and bank deposit tokens. That is a map of trade-offs rather than a statement that one form wins.
| Settlement form | What it solves | Which still blocks scale | Who gets influence |
|---|---|---|---|
| Balances of exchange clearing accounts | Uses existing central bank clearing money and known institutional rails | Requires synchronization with tokenized platforms and depends on access rules | The RBA and institutions with access to settlement accounts |
| Pilot wholesale CBDC | Could bring central bank risk-free money closer to tokenized asset ledgers | Asks questions about business operations, policy, access and implementation | The central bank and approved infrastructure managers |
| Tokenized commercial bank deposits | Keeps settlement within the banking system and may fit into bank-mediated markets | Needs common standards so that bank tokens do not create separate liquidity pools | Banks and shared deposit token networks |
| Stable coins | Could lead to a permanent settlement and wider competition in the private sector | Depends on reserve rules, redemption, licensing and confidence in issuers | Stablecoin issuers, distributors and platforms that integrate them |
RBA Assistant Governor Brad Jones provided the key nuance in a March speech: Wholesale CBDC could be useful, but it was far from essential for tokenized markets to take off.
Instead, he pointed to tools like RITS synchronization, fast payment rails and existing central bank infrastructure as short-term paths.
Acacia therefore falls outside the well-known CBDC argument. The experiment shows that early tokenized markets can start with existing settlement tools, while the case for wCBDC increases as those markets become systemically important or require risk-free settlement with functionality that existing reserves cannot provide.
Interoperability determines whether liquidity fragments
The settlement problem is also a market design problem.
If one platform settles in a bank deposit token, another in a stablecoin, and a third through central bank accounts, participants need a way to move between these forms on an equal footing and with predictable legal treatment.
Otherwise, liquidity is distributed across money silos and each location asks traders or institutions to pre-position money before knowing where the trade will take place.
That is why the money form changes the power structure. Central bank settlement balances retain the role of regulated settlement account holders. Deposit tokens expand bank money into tokenized markets, but require banks to agree on standards.
Stablecoins add private competition, but pose reserve, redemption and regulatory questions. A wholesale CBDC could provide a risk-free settlement asset with programmable features, but it also brings the central bank closer to designing the market infrastructure.
Project Acacia’s pilot boundary is important. The trials were supported by ASIC regulations, which means the activity should be treated as limited testing, rather than broad commercial permission for tokenized settlement.
Separately, ASIC’s 2025 stablecoin exemption for distributors of an Australian stablecoin shows that stablecoin issuance, distribution and related intermediary services remain bound to a licensing perimeter that is still being clarified.
That is the tension for policymakers. Tokenized markets need space to test true value, but settlement systems are not apps that can fail without consequences.
Once settlement money becomes part of the institutional market infrastructure, questions about access, repayment, legal finality and financial stability shift from background issues to launch conditions.
The follow-up agenda shows how far Australia still has to go before a model becomes a production infrastructure.
The RBA and DFCRC pointed to extensive coordination between regulators and industry, possible sandbox work on digital financial market infrastructure, tokenized government bond exploration, deposit-token interoperability, consultation on settlement infrastructure and access to exchange accounts, and further applied wCBDC research.
That list is more revealing than a simple technology roadmap. Tokenized government bonds would test whether the state is willing to put an important public asset into a tokenized life cycle.
Interoperability between deposit tokens would test whether banks can avoid creating separate pools of private money. The ESA access work would test whether more participants can safely reach central bank settlement.
A sandbox would test how much real-world regulators will allow before all legal questions are resolved.
What Project Acacia revealed
Australia also has a case for separating wholesale tokenized finance from retail CBDC politics.
The RBA and Treasury previously found no clear public interest argument for issuing a retail CBDC in Australia at the time, while placing greater emphasis on wholesale digital money and tokenized market research.
Project Acacia fits into that path: the focus is on market infrastructure, not on replacing cash by consumers.
There is also a global context. The work of the BIS and the CPMI has made tokenization an issue for central banks, because money and assets must move together without undermining the unity of money.
CryptoSlate has separately covered the growth of stablecoins as a live settlement market, the modernization of central bank settlement in Britain and questions about tokenized stock policies in the US.
Project Acacia adds a more concentrated test: different settlement formats within one institutional market stack.
Project Acacia revealed that the next battle in tokenized finance is less about whether assets can be tokenized and more about which settlement regulators, banks and market operators can make interoperable.
Stablecoins can be useful where always-on private sector settlement and distribution matter most, but licensing and reserve trust remain limitations.
Deposit tokens may be suitable for bank-led markets, but only if they do not lock in liquidity within separate banking networks. The central bank’s existing settlement infrastructure can support early synchronization, but access rules and operating hours still determine adoption.
Wholesale CBDC remains a stronger candidate if tokenized markets become important enough to require risk-free money with more direct programmability.
The Australian findings make a hierarchy of settlement assets seem more likely than a single substitute for cash. The cash part must be trusted enough by regulators, flexible enough for market participants and interoperable enough so that liquidity does not fragment as assets move.
The next test is which clearing model regulators will allow to leave the pilot phase, under what entry rules and with sufficient legal certainty to support real institutional volume.