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Project Acacia, Australia’s research program into wholesale digital currency, has reached a “significant milestone”, with participants selected to explore innovations in digital money and settlement infrastructure.
The development paves the way for the pilot scheme, a joint initiative between the Reserve Bank of Australia (RBA) and the Digital Finance Cooperative Research Centre (DFCRC) to move on to its next phase, testing use cases.
The project is examining whether innovations in digital money and existing settlement infrastructure might support the development of Australian wholesale tokenised asset markets.
Testing
Testing will take place over the next six months, with a report on the findings from the project expected to be published in the first quarter of 2026.
Lead participants include the Australian Bond Exchange, Australia and New Zealand Banking Corporation, Australian Payments Plus and Commonwealth Bank of Australia.
Supported by the Australian Securities and Investments Commission (ASIC), the Australian Prudential Regulation Authority (APRA), and the Australian Treasury, the project has selected 24 use cases.
They range from small fintechs to large banks, and will involve 19 pilot use cases of real money and real asset transactions and five proof-of-concept use cases with simulated transactions.
The use cases cover a range of asset classes, including fixed income, private markets, trade receivables and carbon credits, and will test stablecoins, bank deposit tokens, and pilot wholesale central bank digital currency (CBDC).
Brad Jones, Assistant Governor (Financial System) at the Reserve Bank of Australia, said that Project Acacia is an opportunity for the public and private sectors in Australia to explore tokenised asset markets and the future of money.
“Ensuring that Australia’s payments and monetary arrangements are fit-for-purpose in the digital age is a strategic priority for the RBA and the Payments System Board,” Jones said.
“The use cases selected in this project will help us to better understand how innovations in central bank and private digital money, alongside payments infrastructure, might help to uplift the functioning of wholesale financial markets in Australia.”
Issuance of a pilot wholesale CBDC for testing use cases will be on a range of private and public-permissioned distributed ledger technology platforms, according to the central bank.
Relaxing rules
As part of its support for the pilot, ASIC is relaxing rules and providing regulatory relief to participants.
This will enable the testing of tokenised asset transactions, in some cases using CBDCs, between participants and a limited number of financial institutions in the coming months.
ASIC Commissioner Kate O’Rourke said the regulator sees useful applications for the technologies underlying digital assets in wholesale markets.
“Importantly, Project Acacia will allow industry and regulators to work together to learn more about how these use cases may reshape the financial services industry, potentially boosting efficiency and foster economic growth.”
The project will be closely watched by policymakers and regulators around the world as they grapple with the opportunities and challenges presented by CBDCs.
Speed but caution
Project Acacia typifies Australia’s approach to CBDCs and digital assets more generally, which is one of speed tempered with caution, balancing innovation with consumer protection and risk management.
The jurisdiction is keen to , and to that end is conducting extensive testing to establish what works.
Australia’s central bank recently struck a more sceptical note on retail CBDC, while remaining positively disposed to its wholesale application.
As covered in žž, in September 2024, in a on CBDCs and the future of digital money, the RBA said it sees “no clear public interest case” to issue a retail CBDC at present.
The central bank added that it has looked at other jurisdictions that have issued a retail CBDC and has found that their motivations for doing so “have less resonance in the Australian context”.
