Live digital currency trials kick off under ASIC green light for Project Acacia
Australia’s push toward modernising wholesale finance has taken a significant step forward, with Project Acacia – a collaborative research initiative aimed at examining how various types of digital currency and supporting systems might enhance the growth of wholesale tokenised asset markets in Australia. It has progressed to an experimental trial stage, with a number of industry participants conditionally selected to pilot the project.
Participants in the trial include major financial institutions such as Commonwealth Bank of Australia, Australia and New Zealand Banking Corporation and Westpac Banking Corporation, alongside local fintechs. The pilot phase will run over the next six months.
In total, 24 use cases are planned as part of the project’s second phase, including 19 pilot projects involving actual monetary and asset transactions, and five proof-of-concept trials simulating the same processes. Use cases will span a range of asset classes, including fixed income, private markets, trade receivables and carbon credits.
The Australian Securities and Investments Commission (ASIC) has paved the way for the pilot to go ahead, exempting participants from various regulations to support its implementation, which would otherwise have hindered participation. The broad involvement of government agencies and financial institutions signals a strong commitment by the Reserve Bank of Australia (RBA) to exploring tokenised finance as a pathway to modernising market infrastructure.
Background
Led jointly by the RBA and the Digital Finance Cooperative Research Centre (DFCRC), Project Acacia is supported by ASIC, the Australian Prudential Regulation Authority (APRA) and the Australian Treasury.
Phase 1 of the Project involved conceptual research and questions for consultation, as outlined within the RBA’s Project Acacia Consultation Paper (November 2024). Conducted during the first half of 2024, this phase focused on:
- examining various settlement models for tokenised asset transactions
- exploring how digital money and infrastructure can support delivery-versus-payment (DvP), ensuring assets are only transferred when payment is received
- identifying different approaches and key considerations for evaluation and comparing the models.
Phase 2 – the experimentation phase – comprises a set of trials designed to explore how emerging forms of digital currency might be used to settle large-scale financial transactions between institutional players like banks and investment firms in Australia.
Settlement assets proposed for the use cases include:
- stablecoins
- bank-issued deposit tokens
- a pilot wholesale central bank digital currency (CBDC)
- innovative applications of banks’ existing exchange settlement accounts held with the RBA.
Brad Jones, Assistant Governor (Financial System) of the RBA, highlighted the project as a key strategic effort to future-proof Australia’s payments and monetary systems. He noted the selected use cases will offer crucial insights into how digital currency innovations and modern infrastructure can strengthen wholesale financial market operations.
ASIC's green light
On 4 July 2025, ASIC introduced the ASIC Corporations (Project Acacia Participation Exemption) Instrument 2025/425. As part of this instrument, project participants were exempted from a suite of regulatory requirements prescribed under the Corporations Act 2001 (Cth), including:
the need for an Australian financial services licence under section 911A, when providing a specified financial service to a wholesale project client
licensing of financial markets and the licensing of clearing and settlement facilities under Parts 7.2 and 7.3 in relation to a use case facility that is, or includes, a financial market, or a clearing and settlement facility
conditional exemptions to sections 5, 6 and 7.
ASIC’s support in Project Acacia’s second phase is critical. Without it, participants would otherwise be undertaking digital asset settlement processes outside the parameters of the law as it is currently written.
ASIC Commissioner Kate O’Rourke said that the regulator supports innovation and the responsible development of digital asset technology, and is providing regulatory relief to enable and promote the safe testing of these technologies within Australia.
What's next?
Phase 2 is scheduled to run over the next six months, with a report detailing the project’s outcomes expected in early 2026. This timeline aligns with ASIC’s regulatory exemption instrument, which is set to expire on 28 February 2026.
Insights gathered from this second phase will help shape the RBA’s ongoing exploration of how financial innovation can strengthen the Australian economy in an increasingly digitised landscape.
This article was written with assistance by Evan Lianos, Law Graduate.
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