ANZ’s stablecoin launch is a good sign of things to come

With the dust now settled, it is time to start looking at the implications of the ANZ stablecoin. The bank’s first effort at minting and leveraging digital assets has, overall, been very positive indeed.

To coincide with Blockchain Australia’s annual conference Australia’s third-largest bank, ANZ, announced that it had developed a stablecoin pegged to the AUD. The genesis of ANZ’s development of the stablecoin was to assist a client, The Victor Smorgon Group, that wanted to transfer funds to a digital asset fund manager. 

ANZ pitches its stablecoin as a gateway for customers who want to interact with digital assets. Where the purchase of USD stablecoin for an Australian customer would involve AUD-USD exchange risk, the use of an AUD stablecoin largely obfuscates this. 

Additionally, transaction times are significantly reduced. If using the existing payments infrastructure, the Victor Smorgon Group’s transaction would have taken some days. However, with the ANZ stablecoin, it took minutes. 

Beyond the efficiencies the ANZ transaction has realised, what is perhaps the most revolutionary aspect of the AUD stablecoin development is the fact that it is bank initiated. Although banks in the US have previously joined forces to mint USD tied stablecoins never before has this been attempted with a local currency. With stablecoins tied to the USD known for breaking their pegs, it is possible that bank-backed stablecoins will continue to grow in popularity, as consumers can trust in these institutions’ decades of financial markets experience.