Stablecoins a key to instant access to global credit markets

As the world enters a digital age, digital assets like stablecoins are not only opening doors for assets like private credit funds that were exclusive to institutional investors, but also a debt universe that is no longer limited to the domestic market, experts told Financial Standard.

Currently, borrowers can access the international debt market, but access remains challenging due to the differences in jurisdictions and regulation.

However, the emergence of stablecoins is slowly broadening that option for Australians.

Explaining, CloudTech Group chief financial officer and executive director Mandy Jiang said stablecoins are widening the world's ability to access credit in ways that were not possible before.

Stablecoins provide access to global lending pools without the existing constraints and delays, she said, and once conditions are met, the 'smart contract' carries out its terms automatically without the need of a bank, lawyer or any third party.

"In a lending context, that means collateral can be posted, verified, and released entirely on-chain. This removes a great deal of the opacity that has long disadvantaged smaller borrowers in international debt markets, by making lending transparent on the blockchain - via the smart contract," she said.

"However, it's important to note that this is not about replacing banks, it's about extending the reach of financial services to people and businesses that have not previously had a seat at the table.

"Having a stablecoin infrastructure in place will pave the way for simplified debt opportunities for local borrowers, giving them access to funding that had previously not been available to them."

Stablecoin AUDD head of product and operations Jason Beale agrees with Jiang, noting the early stages of adoption, particularly in cross-border payments among institutional users, is now prominent but mainstream uptake will be evolutionary rather than overnight.

"By providing a trusted digital representation of fiat currency, they remove structural barriers that have historically made capital movement between jurisdictions slow and difficult to access," Beale said.

"In practice, this supports the growth of tokenised private credit and digital financing models, where borrowers are no longer limited to local pools of capital. Instead, they can access a broader, global investor base, with funding and repayments settled instantly via stablecoins, and fewer intermediaries passing costs down the value chain.

"Importantly, stablecoins like AUDD are not providing the lending themselves, they act as the payment, settlement and liquidity rail underpinning these transactions. That distinction matters, because it is what allows digital markets to scale while maintaining clear roles across the ecosystem."

Beale added the innovation will provide an exciting opportunity for investors to gain greater access to diversified opportunities, with improved transparency.

"What underpins this transition is the role of stablecoins as the settlement layer," he said.

"Stablecoins like AUDD are already operating within this emerging architecture, and as that becomes more widely adopted and better integrated with regulated frameworks, we move closer to a financial system where capital can flow more freely, without compromising trust or oversight."

Meanwhile, Jiang is also observing more private credit products being offered in a tokenised form to make investment more accessible and seamless through the fractionalised structure.

She added the increased regulation scrutiny on the sector will provide better confidence in consumers, while the draft legislation to allow advisers, institutions, and retail investors to participate will further pledge that confidence.

"That clarity tends to accelerate adoption more than any technological breakthrough," she said.