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ANZ stablecoin amplifies changing operating models

ANZ has seized the opportunities afforded to it by global digital currency adoption and created the first Australian-bank-issued stablecoin with positive results.

Having only recently minted its first stablecoin, ANZ has already found several key elements of success.

The bank discovered digital asset service components were composable and enterprise-ready which helped the company circumnavigate costly centralised infrastructure.

ANZ continued to tout lower barriers to entry, having acknowledged the benefits of smart contract auditing, on-chain compliance and digital asset custody services.

Moreover, ANZ's calculated foray into innovative digital asset transactions has presented a chance for regulators to learn from the bank's experimentation.

According to ANZ bluenotes, the first Australian-bank-issued Australian-dollar stablecoin, A$DC, went live in March. The first payment of A$DC was made through a public, permission-less blockchain transaction that used Fireblock's technology.

A bluenotes statement noted: "In a live transaction for ANZ customer Victor Smorgon Group we delivered the stablecoin to Zerocap, a private wealth management firm for digital assets."

"$A30 million in A$DC was minted as part of the transaction - pegged to the Australian dollar - which was transferred between the two parties and then later redeemed into fiat currency (conventional state-backed currency)."

ANZ banking services lead Nigel Dobson described Defi as a new world and traditional banks as old-world TradeFi institutions, but he said those aren't necessarily mutually exclusive elements.

Dobson then explained some of the bank's potential roles as a stablecoin issuant: "As an approved deposit-taking institution we can hold deposits, that's valuable."

"Because of the regulatory perimeter in which we operate we can offer a number of other services, including the minting and redeeming part of the coin issuance and management.

"In the custody space - which again is regulated, we can hold our customers' private keys on behalf of them. There are potentially other use cases where, depending on the nature of the assets that are tokenised, there will be a number of financing opportunities.

"As a bank, we're comfortable dealing with supply chain automation and digitisation opportunities."

From a central bank and regulatory standpoint, Dobson concluded: "We're not altering the money supply. We're just enabling a transaction to occur in a venue that is new from an operating model point of view but not necessarily very new from a business model point of view."

Bluenotes denoted ANZ's digital asset strategy as not just exciting but essential if the bank is to have an enduring role in a world where DeFi and TradFi merge.

Read more: ANZA$DCDeFiCBDCFireblockNigel DobsonTradFiVictor Smorgon GroupZerocap