Australian banks are using small but meaningful stablecoin trials to accelerate complex loan and bond deals, aiming to deliver near instant settlement and lower costs, but this shift towards blockchain based money also appears to weaken the security and dominance of traditional bank deposits.
Right now, stablecoins are moving from a crypto niche to mainstream infrastructure, with their global market value climbing past about $US315 billion in just two years and some forecasts suggesting they could reach around $US3 trillion by 2030. Built to track government currencies such as the US dollar or the Australian dollar, these tokens are being plugged into major payment apps, merchant processors and card networks, which pushes banks and regulators to move faster than the cautious wait and see stance they held only a few years ago.
In Australia, regulators have only recently signed off on the first local dollar stablecoins, and instead of appearing in everyday retail spending, they are being tested behind the scenes in capital markets under a joint project run by the central bank and a digital finance research centre. In one pilot, an Australian dollar stablecoin issued by a payments group moved between a regional bank, a large super fund and major banks via a digital marketplace, with tokenised deposits and debt instruments all settling within minutes instead of taking a full day under current systems. Another trial involved a tokenised corporate bond funded and traded using a different Australian dollar stablecoin, again executed entirely on blockchain rails. Participants say this demonstrates how “atomic settlement” can synchronise payment and asset transfer in a single rapid transaction.
The bigger concern emerges as these experiments move closer to consumer wallets. If stablecoins evolve into everyday payment and savings tools, bank analysts argue they could divert money away from traditional deposits in a way that echoes the rise of money market funds in the 1980s. Some countries that already license stablecoins, such as those in Europe and parts of Asia, restrict issuers from paying interest. New US rules backed by the federal government, however, appear to leave room for reward style returns that might blur that line, and Australian policymakers are now drafting digital asset legislation that would give the prudential regulator oversight of local issuers.
From a distance, stablecoins appear likely to cut bank funding costs and fee income at the same time by offering cheaper cross border transfers and new on chain services, while also opening revenue streams linked to blockchain settlement, currency conversion and tokenised assets. Analysts at investment and consulting firms suggest this new model, often backed by diversified portfolios of government bonds rather than highly leveraged balance sheets, seems more resilient in some stress scenarios. This raises the possibility that stablecoins not only transform how payments work but also gradually redefine what people regard as “safe” money both inside and outside the banking system.
