Part one: the idea
Three words keep arriving in board papers, bank announcements and regulator speeches: crypto, stablecoins and decentralised finance. They are usually explained by people who already understand them, in a vocabulary built to keep it that way. Here is the plain version, and it fits in one sentence. All three are ways of writing down who owns money, or a claim on money, on a shared register that can enforce its own rules.
That is the whole idea. Crypto is the register with its own made up unit on it. A stablecoin is the register carrying a claim on ordinary dollars. Decentralised finance is a program on that register that holds the money and lends it, swaps it or pays it out by rule, without a person in the loop. Everything else is detail, and most of the detail is about trust: who owes you the dollar, what stands behind them, and what happens when something goes wrong.
Start with what you already know
When your business holds a dollar in the bank, the dollar is not sitting in a vault. It is an entry on the bank's ledger, a promise by the bank to pay you a dollar on demand. You trust that promise because the bank is supervised by APRA, because deposits are guaranteed up to a limit, and because a century of habit says the entry will still be there tomorrow. Notice what is doing the work. It is the register, and the institution that keeps it.
Now notice what that register is poor at. It works during banking hours. It settles with other banks through a chain of correspondent accounts, so a payment to a supplier overseas can take days and shed fees at every hop. It cannot carry a rule. You cannot tell your bank account to release payment the instant goods are scanned at a port. Somebody has to check, then somebody has to press a button.
What a stablecoin actually is
A stablecoin is a register entry. Hold on to that sentence, because it makes most of the confusing coverage fall into place. A company takes real dollars, puts them in a reserve, usually short dated government bills and bank deposits, and issues tokens on a shared public register, one token for one dollar. The token is a claim on the issuer, redeemable for a dollar. What changed is not the dollar. What changed is that the claim now lives on a register that runs every hour of every day, crosses borders without correspondent banks, and can carry rules.
The word programmable is the part that matters, and it is the same word that matters in our Real World Assets guide, which covers old assets on these new rails. A traditional ledger is a list. A programmable register is a list that can also carry instructions and enforce them itself. It can be told that the token moves only when the goods are confirmed, or that interest is paid to whoever holds a unit at midnight. That is the actual innovation. Not the coin, not the speculation, and not the vocabulary.
What decentralised finance actually is
Decentralised finance, shortened to DeFi, is what you get when the rule is not just attached to a payment but becomes the whole business. A lending protocol is a program on the register that holds a pool of tokens, lends them to anyone who posts more collateral than they borrow, sets the interest rate by a formula that reads supply and demand, and if the collateral falls in value lets anyone repay the loan and take that collateral at a discount, which happens within minutes. Nobody approves the loan. Nobody can be rung. The program is the bank, the credit committee and the collections department, and it is open to the world.
The ring at the top turns on its own. Use the buttons beneath it: press Stablecoin, then Put it to work, to watch each of these change.
It lives on a blockchain. The same program and the same balances are copied on thousands of computers, so it runs without anyone switching it on and cannot be quietly edited.
Sets the rate: higher when the pool runs low, lower when it is full.
If the stranger's crypto falls, lets anyone repay the loan and take the crypto at a discount, so you are paid back within minutes.
Never asks who anyone is. Never closes. Cannot be reasoned with if it goes wrong.
The people who wrote it. A founding team writes the program and often keeps, or appoints, a key that can pause or change it.
The people who vote. Holders of a governance token vote on changes. At the big ones, five holders own about half.
The club is called a DAO. A decentralised autonomous organisation: the token holders and the program together. Membership is the token, the vote is on the blockchain, and in most countries it has no legal form of its own.
The courts are finding them. A US court treated a DAO as an association whose voting members can be sued.
That is the whole of a lending protocol. The same shape, with the pool holding two different tokens, is an exchange. With the pool holding locked collateral and issuing a dollar token against it, it is a decentralised stablecoin, and the third largest stablecoin issuer in the world, Sky, is a program of exactly that kind rather than a company. In Australia, a yield product built this way is likely to be a financial product.
For a reader who understands a bank
A finance leader already knows how a bank turns deposits into loans, so the fastest way to understand a pool is to notice where it is the opposite of a bank.
A bank lends more than it holds. Deposits are lent out many times over, a fraction is kept back, APRA sets the capital and liquidity the bank must hold, and a government guarantee stands behind the deposits. Short deposits fund long loans. That is how a bank creates money, and why it needs a supervisor.
A pool lends less than it holds. It can only lend what is actually in it, and every loan is backed by collateral worth more than the loan: at the largest lending protocol a borrower using stablecoins or ether can take up to about seventy five cents on the dollar and is liquidated at about eighty. Nothing is created and no maturity is transformed. The price of that safety is a rule no bank has: when a pool is fully lent out, lenders cannot withdraw until someone repays. That is the DeFi version of a run, and the rising rate is the only thing that ends it.
Where the yield comes from. Borrowers pay it. The program sets the rate from how much of the pool is in use, and keeps a slice for the protocol's own treasury, ten per cent of the interest on the safest assets and up to thirty five per cent on the riskiest at the largest protocol. What is left is shared among the lenders in proportion. There is no margin lending, no fee income and no leverage inside the pool itself, so the yield can only ever be what a stranger is willing to pay to borrow.
What it costs to use. Every action on the blockchain pays a small transaction fee to the network, about fifteen cents for a swap on Ethereum on the day this was checked, and it moves with congestion. Swapping one token for another on the largest exchange costs between one hundredth of one per cent and one per cent of the trade, most of it to the people who supplied the liquidity and between a sixth and a quarter, since late December 2025, to the protocol. A borrower who is liquidated pays a penalty on top. And at the end you still have to get back to bank dollars, through an exchange, at its fee.
What a DAO is, in law. The club that governs a protocol, the token holders and the program together, is a decentralised autonomous organisation. Wyoming gave DAOs a limited liability company form in 2021 and an American court treated one as an association whose voting members can be sued in 2023. In Australia a Senate committee recommended a DAO company structure in October 2021 and the government of the day agreed in principle that December; no law has followed, so an Australian who votes in one is, in the eyes of the law, a member of an unincorporated club with no limited liability.
How many of these exist. The tracker DefiLlama follows about fifteen thousand yield pools across roughly five hundred protocols on a hundred blockchains. The money is not spread across them. The ten largest protocols hold between five and twenty four billion US dollars each, a little over twenty hold more than a billion, and the long tail is tiny. The lesson is the one a banker already knows: the market has already picked its majors, and the rest is where the losses happen.
Sky's rate is set by its token holders' votes and is a matter of record: 12.5 per cent at the start of 2025, 8.75 in early February, 6.5 later that month, 3.6 by September 2026. Aave and Maple from DefiLlama, 9 September 2026. Maple lends to vetted institutional borrowers, a different risk from an open pool. For the bank rate these compete with, see the Cost of Cash Machine.
Read those numbers the way you would read a term deposit sheet. The yield on the big pools has more than halved since the start of 2025, and on the day of writing they paid a little under four per cent on US dollar tokens, with the largest of them ninety four per cent lent out, before the network fee, before the exchange fee, and before any allowance for the program being robbed, the peg breaking or the pool being fully lent out when you want your money. That is a rate a bank would pay you with a guarantee behind it. The pool pays it with a stranger's collateral behind it and nobody to ring. Whether that trade is worth making is a judgement, and now you have the numbers to make it.
What it is not
Three corrections worth making early, because each one causes expensive confusion.
It is not money, in the eyes of the tax office. The Australian Taxation Office treats crypto assets, stablecoins included, as property rather than currency. For a business that means each disposal is a capital gains event, or trading stock if you deal in them, and crypto received for goods or services is ordinary income at its Australian dollar value on the day. The one mercy came in 2017, when buying and selling digital currency stopped attracting GST. Records of every transaction must be kept for five years.
It is not a bank deposit. A stablecoin is a claim on a company, not on a bank, and in Australia there is not yet a licensing and prudential regime for the company that issues it. The draft law exists and is worked through below. The practical difference showed itself in March 2023, when the second largest dollar stablecoin, USDC, briefly traded below a dollar after its issuer disclosed that about eight per cent of its reserve sat in Silicon Valley Bank on the weekend that bank failed. The peg returned when American regulators guaranteed the deposits. The token was fine. The reserve was the question.
It is not outside the law. This is the most important correction in the guide. In June 2026 the High Court of Australia found, unanimously, that a crypto product offering a fixed yield was a financial product under the Corporations Act, whatever it was called. ASIC's guidance already says stablecoins, wrapped tokens and digital asset wallets are financial products. The American securities regulator said the same about tokenised securities in January 2026. Recording something on a new register does not change what it is.
If a product would be regulated on paper, it is regulated as a token.
Why anyone bothers
Four benefits are consistently claimed, and the central banks that have tested the machinery report evidence for each, with caveats that follow in the reality check.
Settlement at any hour, in any place. A token moves at three in the morning on a public holiday, and it moves to Manila as easily as to Melbourne, because the register does not close and does not route through correspondent banks.
Payment that carries its own conditions. Because the register can enforce a rule, payment and delivery can be tied together so that neither side is exposed in the gap. That is the same mechanism the Reserve Bank tested in Project Acacia, where stablecoins were one of four settlement assets used to pay for tokenised bonds, funds and trade payables.
A dollar for people who cannot easily get one. Outside rich countries, a token that holds its value against the US dollar is a store of value that a local bank account may not be. This is where a great deal of real world stablecoin use sits, and it is the reason more than ninety nine per cent of stablecoins are denominated in US dollars.
One register for the money and the asset. When the asset being bought and the money paying for it sit on the same register, the two can change hands in the same instant. This is the reason stablecoins keep appearing in tokenisation projects that have nothing to do with crypto.
A necessary reality check
Before either rail, the honest numbers. Stablecoins are real, large and growing, and they are also concentrated, almost entirely American, and still mostly used for one thing.
On the day this guide was written, tokens claiming to be worth one US dollar were in issue to a value of about three hundred and six billion dollars, by the count of the tracker DefiLlama. Two issuers, Tether and Circle, account for roughly five dollars in every six. The third largest issuer is not a company at all but Sky, the decentralised program formerly known as MakerDAO, with about eleven billion dollars across its two tokens. Daily transaction volume is the number most often quoted and least worth trusting: when Visa's analysts stripped bots and exchanges shuffling their own money out of one thirty day window in 2025, the figure fell from about 3.9 trillion to about 820 billion US dollars, and retail payments were under one per cent of what remained.
The Reserve Bank's own review in October 2025 put the market's main use plainly: a bridge for trading crypto assets, with the broader payment and store of value uses still projections. The Financial Stability Board estimated in July 2026 that stablecoins carried less than a fifth of one per cent of cross border payments in 2025.
Decentralised finance is smaller again and harder to measure. The same tracker gives figures for money committed to DeFi programs that differ by tens of billions depending on what is counted, which is itself the lesson: there is no reliable single number, so this guide does not quote one. The Bank for International Settlements assessed stablecoins in June 2025 against three tests that any form of money must pass, singleness, elasticity and integrity, and concluded they perform poorly on all three and may at best play a subsidiary role. That is the view of the central banks' central bank, and it is worth holding alongside the enthusiasm.
Stablecoins in issue updated weekly from DefiLlama. Currency share, Bank for International Settlements. Volume, Visa Onchain Analytics with Allium.
Part two: the map
Everything a finance leader will hear about on this frontier is one of four things: money, assets, rails or programs. Once you can place a headline on that map, most of the confusion goes.
Money
Stablecoins. A claim on a company, recorded as a token, redeemable for a dollar. The whole of Part one. What you will meet first if a supplier abroad asks to be paid.
Deposit tokens. A claim on a bank, recorded as a token. Same idea, but the bank you already know stands behind it and APRA supervises it. This is what ANZ, HSBC and Standard Chartered are moving on Swift's ledger, and it is what you will meet first at home.
A central bank digital dollar. A claim on the Reserve Bank itself. Australia has looked twice, in September 2024 and again on 3 September 2026, and found no strong case for one in your pocket. The wholesale version, for banks settling with each other, is the one being built.
Assets
Bitcoin. A made up unit on a register with no issuer, no company and no claim on anyone. Its supply is capped at twenty one million by the program itself; about twenty point one million exist, roughly four hundred and fifty more are created each day, and the rate halves every four years, most recently in April 2024. New supply is now under one per cent a year. The Reserve Bank's own explainer puts the other half plainly: it has no legislated value and nobody stands behind it. Its price is whatever the next buyer pays.
What immutable actually means. The word is used loosely. It means that a confirmed transaction cannot be reversed and the rules cannot be changed without nearly every computer on the network agreeing. That is all it means. The price is not immutable. The exchange holding your coins is not immutable, as Bybit learnt in February 2025. And your access is not immutable: lose the key and the coins sit on the register forever, visible to everyone and reachable by no one.
Ether, and staking. The unit that pays for running programs on Ethereum, the chain where most stablecoins and DeFi live. It can also be staked: locked up to help run the network in exchange for a share of the fees, a little over two per cent a year through the largest staking service in September 2026, down from around three at the start of the year. The tax office treats staking rewards as ordinary income on the day they arrive, valued in Australian dollars.
Tokenised traditional assets. Bonds, funds, property, invoices and deposits written onto the same registers. That is a different subject with a different set of rules, and it has its own guide: Real World Assets. The boundary is simple. That page is old assets on new rails. This page is new assets and new money.
How a board meets them. Three doors. A listed fund, which holds the exposure without the keys: bitcoin on the ASX since June 2024, ether since February 2025. A treasury holding, which is Strategy's door and is worked through in the treasury rail below. Or direct ownership through a custodian, which is the door that needs the most care, and the next section explains why.
Rails
A blockchain is the register. One shared public list of who holds what, copied on thousands of computers around the world, updated in blocks every few seconds or minutes, with each block locked to the one before. Nobody is in charge of it, which is the point, and everything on it is visible to anyone forever, which is a point a business should think about before it pays a supplier on one.
Two ways of keeping it honest. Bitcoin uses work: computers race to solve a puzzle and the winner writes the next block, which is why bitcoin uses about a hundred and thirty eight terawatt hours of electricity a year, roughly half of one per cent of the world's supply, about half of it from sustainable sources, on Cambridge University's 2025 estimate. Ethereum switched in September 2022 to stake: computers put up ether as a bond and lose it if they cheat, which cut its energy use by more than ninety nine point nine per cent. When a board asks the energy question, that is the answer, and it depends entirely on which chain.
Keys and custody. Whoever holds the private key holds the asset. There is no forgotten password link, no branch and no one to ring; ASIC's own guidance says it plainly. So the operational questions are the whole game. Cold storage means the key lives on a device that never touches the internet. Multisig means a transfer needs several people's keys, not one. Bybit had both and still lost about one and a half billion US dollars in February 2025, because the screen its signers approved on had been tampered with. From 9 April 2027 an Australian business that holds tokens for others needs an Australian financial services licence. Until then, and after it, the rule for a company is the same as for a cheque book: never one person, never one key.
Where the losses actually happen. Four places. Bridges, the software that moves tokens between chains, which carried nearly two thirds of the money stolen from DeFi in the worst year on record. Oracles, the price feeds a program trusts, which attackers manipulate to make a program believe a worthless token is valuable: forty one such attacks in 2022 on Chainalysis's count, and thirty two in the first eight months of 2026 on TRM Labs's. Exchanges, which is Bybit. And the programs themselves, which is April 2026. Notice that none of them is the blockchain. The register held. The things bolted onto it did not.
Programs
The fourth thing is decentralised finance itself: the pool you met above, and its cousins the exchange and the decentralised stablecoin. Every program on the map is a set of rules holding money on the register with nobody in the chair, and every one of them has the two features the object showed: it cannot be reasoned with, and somebody holds the keys to it.
The tax office is already here. Every swap, wrap, stake and airdrop is an event. Staking rewards are income on receipt. In August 2026 the tax office issued draft rulings that an airdrop is generally a new asset for an investor and that wrapping a token, the routine step of converting ether into a form a program can use, is itself a disposal for capital gains purposes, both ways. Comments close on 2 October 2026. A business that touches DeFi without a ledger of every movement is building a problem for its tax adviser, one transaction at a time.
Part three: the two rails
Every question a finance leader meets here is one of two. Can I pay or be paid with this, which is a settlement question. Can I hold or earn with this, which is an asset question. Both run on the same register and both are below. Use the path control on the left to read for your desk.
Paying and being paid
Start with the request you will actually get. A supplier in another country, or a contractor, or a customer, asks to settle in a dollar token rather than by bank transfer. It is faster for them and cheaper at their end. The question for you is not whether the technology works. It does. The question is what it does to your ledger, your compliance file and your audit.
What is actually available in Australia. Less than the coverage suggests, and more than a year ago. The first Australian dollar stablecoin issued under an Australian financial services licence, AUDM, launched in September 2025 after its issuer, Catena Digital, was licensed in July that year. ASIC has since granted relief so that intermediaries can distribute a licensed issuer's stablecoin without holding every licence themselves. A second token, AUDF, was added to that relief in late 2025, and an older token, AUDD, has run since 2022 and its issuer now also holds a licence. ANZ minted the first bank issued Australian dollar token in 2022, has used it in pilots, and settled its Project Acacia use cases with a wholesale central bank digital currency and a stablecoin or deposit token, but there is no general bank product you can open an account for. Overseas, Stripe now offers stablecoin accounts in more than a hundred countries and Shopify merchants can accept USDC. None of that yet amounts to an Australian payments product a mid sized business would ordinarily use.
The borders. This is where the strongest real use sits, and it is worth being precise about who is doing it. The businesses breaking down borders are companies with licences, not programs with nobody to ring. Ripple, the company behind XRP, sells settlement to banks and payment firms, issues its own dollar stablecoin under New York supervision since December 2024, and in December 2025 received conditional approval from the American banking regulator for a trust bank that may hold reserves and custody but may not take deposits or lend.
The banks are moving on their own rails: in July 2026 Swift declared its shared ledger ready for seventeen banks, ANZ among them, to move tokenised deposits across time zones outside banking hours, and in August 2026 HSBC and Standard Chartered executed the first live transaction on it. Note what those are: bank deposits, tokenised, moving between supervised banks. The Financial Stability Board's estimate is the sobering companion. On its estimate, stablecoins carried less than a fifth of one per cent of cross border payments in 2025.
The card schemes. The schemes have worked out that the safest place to stand is underneath. Visa has settled with selected partners in USDC since 2023 and widened that in December 2025. Mastercard has done the same and in June 2026 extended stablecoin settlement across more of its network. The point for a finance leader is that the merchant never touches a token: the invoice says dollars, the card says dollars, and the settlement between the banks behind them happens in a stablecoin at any hour. American Express has said only that stablecoins are a good alternative to bank transfer rails and that there is more to play out; it has advertised for a stablecoin strategist and announced no product. That is the likely shape of your first stablecoin transaction: one you did not notice.
The accounting question. There is no rule in Australian accounting standards that says a stablecoin is cash or a cash equivalent. The 2019 interpretation that governs crypto holdings treats them as intangible assets, or inventory if you deal in them, and a stablecoin's treatment turns on whether you hold an enforceable right to redeem it for cash. The American standard setter began consulting in 2026 on examples of when a stablecoin could count as a cash equivalent. Australia has not. Ask your auditor before the first token arrives, not after.
The compliance question. From 31 March 2026 crypto exchanges became virtual asset service providers under AUSTRAC, with the newly covered transfer and custody services and the travel rule, which requires sender and receiver details to move with a transfer, following on 1 July 2026. If you merely pay a supplier you are not a service provider. But the platform you use is, and its obligations shape what it will ask of you. The tax office, separately, wants a record of every movement for five years.
What is genuinely different. Settlement at any hour, a payment that can carry its own release condition, and a route across borders that does not pass through a correspondent bank. Those are real, and they are the reason the Reserve Bank expects stablecoins to play a role in smaller tokenised markets even as bank deposit tokens take the larger ones.
What this means for a payments desk. Nothing this quarter, unless a counterparty forces the question. When one does, the sensible order is auditor first, then bank, then platform. And the honest answer to give the supplier in the meantime is that you will pay them in dollars, promptly, by a route your auditor already understands.
If a supplier asked to be paid in a dollar token on Friday night, who in your business would know what to do, and what would your auditor say on Monday?
Holding and earning
The payments desk meets this as settlement. The treasury meets it as an asset, and as a source of yield that arrives without a name attached. Both deserve a plain look.
Crypto on the balance sheet. The most watched example is the American software company Strategy, which by September 2026 held about 845,000 bitcoin at a cost of about sixty four billion US dollars, worth about fifty five billion in late July, and had sold about seven thousand of them during the year to fund dividends on its preferred stock and to buy some of that stock back. Tesla holds a much smaller position and reports a gain or a loss on it every quarter. In America a 2023 accounting change means those holdings are carried at fair value through profit each period. In Australia, under the international standards we use, a crypto holding is an intangible asset carried at cost and written down when it falls, with any write back capped at original cost unless an active market lets you revalue it. The same asset can therefore produce two very different sets of accounts, and a board should know which one it is looking at.
Where the yield comes from. A decentralised lending pool pays interest because borrowers pay it. Borrowers post more collateral than they take, usually other tokens, and the program liquidates them if the collateral falls. That is a real source of return, priced by a formula. But a great deal of advertised crypto yield has come from somewhere else: new tokens minted by the platform to attract deposits, or the platform lending customer money to other platforms. TerraUSD paid close to twenty per cent on an algorithmic stablecoin with no reserve of dollars behind it, and in May 2022 it collapsed with investor losses the United States Department of Justice put above forty billion dollars. Celsius, which promised yield on deposits, froze withdrawals a month later. Its founder is serving twelve years.
What the law says about yield. In Australia the answer arrived on 17 June 2026, when the High Court held that a fixed yield crypto product was a financial product regardless of the words used to describe it. In America the new stablecoin law goes the other way for the coin itself: an issuer may not pay a holder interest for merely holding a token, which is why the yield fight has moved to the exchanges. The lesson for a treasury is simple. A return that nobody is legally obliged to pay you is not interest. It is a bet on a program and on the people who wrote it.
The honest constraints. The register can be robbed. In 2022, the worst year on record, more than three billion US dollars was stolen and most of it came from decentralised protocols. In 2024 and 2025 the pattern shifted to centralised exchanges, including the theft of about one and a half billion dollars from Bybit in February 2025, which the FBI attributed to North Korea, and then swung back: in April 2026 two decentralised protocols lost nearly six hundred million dollars between them in a single month. There is no deposit guarantee, no chargeback and often nobody to sue.
So the useful posture for a treasury is not to seek out a yield, because at the rates that make the headlines the yield is usually the risk in disguise. It is to understand that the register can hold an asset and lend it by rule, that Australian law already reaches the products built on it, and that a board presentation which cannot name who is obliged to pay the return has not yet described an investment.
If a yield has no name attached to the party obliged to pay it, who do you ring when it stops?
Where the two rails meet
Strip both rails back and the same three sentences describe them. A claim on money that lived on one institution's ledger now lives on a register several parties read at once. A settlement that took days happens in an instant, at any hour. A rule that a person used to enforce is now enforced by the register itself.
Both desks have spent careers managing the risk that lives between paying and receiving, and between promising and delivering. The claim being tested is that a register can close those gaps by itself. The evidence so far is that it can, for some things, at a price that is mostly paid in trust.
Part four: the landscape
Where Australia actually is
Further along on law than on products, and further along on wholesale plumbing than on anything a customer would notice.
The platform law has passed. The Corporations Amendment (Digital Assets Framework) Act 2026 passed Parliament on 1 April 2026 and received Royal Assent on 8 April. From 9 April 2027 the businesses that hold or trade tokens for customers, and the platforms that tokenise custody of assets, will need an Australian financial services licence from ASIC, with a transition period after that. Until 30 September 2026 ASIC is running a no action position for businesses that have applied for a licence, and had received more than forty five applications by early September.
The stablecoin law has not. The regime that would license issuers of Australian dollar stablecoins, as providers of tokenised stored value facilities, with APRA supervising the large ones, was released as draft legislation in March 2026 and had not been introduced to Parliament when this guide was written. In the meantime ASIC treats stablecoins as financial products under existing law, has licensed issuers, and has granted relief so distributors can offer a licensed token.
The anti money laundering net has widened. The virtual asset service provider regime commenced on 31 March 2026, with obligations for the new transfer and custody services and the travel rule from 1 July 2026, and lawyers, accountants and real estate professionals came under AUSTRAC on the same day. AUSTRAC has also put crypto ATM operators on notice, imposing a five thousand dollar cash limit in June 2025 and taking one operator's machines offline in August 2026.
The central bank has drawn its line. The Reserve Bank and Treasury found in September 2024, and said again on 3 September 2026, that there was no strong case for a retail digital dollar. Project Acacia, whose final report arrived on 18 May 2026, tested twenty wholesale use cases and used stablecoins, bank deposit tokens, a pilot wholesale central bank digital currency and ordinary settlement balances as the money. The Bank's assistant governor said in March 2026 that stablecoins are likely to settle smaller new tokenised markets while bank deposit tokens take the larger ones, and that a licensing regime for Australian dollar stablecoin issuers is an important pillar of the Government's approach.
The scams are real and measured. The National Anti Scam Centre reported investment scam losses of about eight hundred and thirty eight million dollars for 2025, down eleven per cent on the year before. Within the losses reported to Scamwatch, crypto was the payment method for about one hundred and twenty one million dollars, overtaking bank transfer. Several of the major banks block or delay some payments to crypto exchanges for that reason.
Where the United States is
The comparison people expect is that America has legalised everything and Australia is behind. That is not quite it. America has passed a stablecoin law and is still arguing about the rest. The GENIUS Act, signed on 18 July 2025, requires a payment stablecoin to be backed one for one by cash, bank deposits and short dated Treasuries, limits who may issue one, forbids paying holders interest, and puts holders first in the queue if an issuer fails. It is law, but it is not yet in force: the implementing rules were still proposals when this guide was written, no issuer had yet been approved under it, although Circle and Ripple have won federal trust bank charters for their reserve and custody businesses, and the outer date for it to take effect is January 2027.
The broader market structure bill, which would divide crypto between the securities and commodities regulators and give decentralised finance its own rules, passed the House in July 2025 and had not passed the Senate by September 2026. Meanwhile the securities regulator has reversed its posture, dropping its cases against the largest exchanges in the first half of 2025 and launching a programme to move markets on chain, the banking regulators have withdrawn the guidance that kept banks away from crypto, and the Federal Reserve has proposed a limited form of account, for clearing and settling payments only, for institutions that are legally eligible but are not full banks. The accounting standard changed too: since 2025 American companies carry crypto at fair value through profit. Australia does none of those things yet, and it legislated the platform regime first.
Where the rest of the world is
Europe regulated first. The European Union's crypto regulation, MiCA, has applied to stablecoins since 30 June 2024 and to everything else since 30 December 2024. Issuers must be authorised, hold reserves and redeem at par. The largest stablecoin, Tether, has not been authorised, and the major exchanges removed it for European users from late 2024.
Britain finalised its regime in mid 2026. The Financial Conduct Authority published final rules on 30 June 2026 and the Bank of England its policy for systemic stablecoins on 22 June, dropping proposed limits on how much an individual or business could hold in favour of a cap on each coin. The regime takes full effect on 25 October 2027.
Hong Kong licensed its first issuers. Its stablecoin ordinance took effect in 2025 and the first licences went in April 2026 to HSBC and to a venture led by Standard Chartered, which began a phased launch of a Hong Kong dollar token in August 2026, with HSBC's due later in the year. Singapore has a framework it is now writing into law, and Japan has one in force and approved its first yen stablecoin in 2025.
The standard setters are cautious. The Bank for International Settlements concluded in June 2025 that stablecoins fail the tests of sound money, repeated the verdict in June 2026, and proposed tokenised central bank reserves, bank deposits and government bonds on a unified ledger instead. The Basel Committee's capital standard for banks holding crypto took effect on 1 January 2026, treating unbacked tokens so harshly that banks can barely hold them, and is now under an expedited review. The Financial Stability Board found in October 2025 that most countries had not yet fully implemented its stablecoin recommendations.
Who is actually doing this in Australia
Honest answer: fewer named players than the volume of commentary suggests.
The banks and the central bank. ANZ, Commonwealth Bank and Westpac took part in Project Acacia with real money and real assets. This is where the serious Australian activity sits, and it is wholesale.
The licensed issuers. Catena Digital's AUDM, Forte Securities' AUDF and AUDC's AUDD are the Australian dollar stablecoins whose issuers hold a licence. All three are small enough that they do not appear in the global tracker's main table, which is a fact about scale rather than a criticism.
The listed funds. Bitcoin exchange traded funds have traded on the ASX since June 2024, and an ether fund since February 2025. They let an investor hold the exposure without holding the token, which is why they exist.
The exchanges. Registered with AUSTRAC, now enrolled as virtual asset service providers, and increasingly the subject of enforcement. ASIC took an eight million dollar penalty from Kraken's Australian operator in December 2024, and won its High Court case against Block Earner in June 2026.
What is genuinely unresolved
A short list, drawn from the regulators rather than the critics. Whether an issuer can honour every redemption on a bad day, which is the run risk the Reserve Bank named. What a stablecoin is on a balance sheet, which no Australian standard has answered. Whether decentralised programs can be made to obey rules about identity and sanctions without ceasing to be decentralised, which is one of the arguments, alongside ethics rules and stablecoin rewards, now stalling the American market structure bill. And what happens to a claim on money when the program holding it is robbed, which so far has been answered by courts, slowly, after the fact.
What to do with this
Nothing urgent. That is the honest answer and it is worth saying plainly, because most writing on this subject is by people selling something. You do not need a stablecoin account, a crypto treasury policy or a view on bitcoin. There is no Australian product waiting for you that your bank does not already do more safely.
What is worth holding is the shape of it. A stablecoin is a register entry, a claim on an issuer, not money and not a deposit. Decentralised finance is a program on that register doing a bank's work by rule, with no one to ring. The law already reaches both, in Australia and abroad, and the accounting has not caught up. The dollar has not changed. What has changed is where the claim on it is written and what that record can do by itself. That is enough to follow the story as it develops, to give a supplier or a board a sensible answer, and to recognise the difference between something real and something being sold to you. Which is the entire point of understanding a thing early.
Before the first token
When a counterparty or a board does force the question, six conversations, in this order, before anything moves.
The auditor. What is this on the balance sheet, at what value, and what evidence of ownership will you accept.
The bank. Will it accept the flows in and out, and at what notice. Several of the majors block or delay payments to exchanges.
The custodian. Who holds the keys, how many people it takes to move anything, whether the keys ever touch the internet, and whether it will hold an Australian financial services licence when that becomes compulsory in April 2027.
The tax adviser. Capital gains on every disposal, income on every reward, five years of records of every movement, and the August 2026 draft rulings on airdrops and wrapping.
The insurer. Usually the shortest conversation. Most policies exclude it, and there is no deposit guarantee.
A one page policy. Which tokens, which chains, which custodian, who may sign, how many signatures, the limit, and who reads the ledger each month. Written before the first token, not after the first loss.
The words
Twenty terms you will meet, one line each, in the order you are likely to meet them.
Corporations Amendment (Digital Assets Framework) Act 2026 and the ASIC implementation roadmap of 20 April 2026. Treasury payments licensing reform exposure drafts, March 2026. ASIC Information Sheet 225 as updated 29 October 2025, ASIC stablecoin relief instruments of September and December 2025, the no action extension of 25 June 2026 and ASIC's final call notice of 2 September 2026. RBA and Treasury update on digital currency, 3 September 2026. ASIC v Web3 Ventures (Block Earner), High Court of Australia, 17 June 2026, and ASIC v Bit Trade, December 2024. AUSTRAC transitional rules and crypto ATM releases, 2025 to 2026. Australian Taxation Office guidance on crypto assets in business and record keeping. IFRS Interpretations Committee agenda decision on holdings of cryptocurrencies, June 2019, and AASB Research Report 20. Reserve Bank of Australia: Project Acacia final report release, 18 May 2026; Financial Stability Review, October 2025; speech by Brad Jones, 25 March 2026; joint RBA and Treasury paper on central bank digital currency, September 2024. National Anti Scam Centre, Targeting Scams 2025. GENIUS Act, White House fact sheet, 18 July 2025, and implementing proposals in the Federal Register, 2026. SEC joint staff statement on tokenised securities, 28 January 2026, with analysis from Morgan Lewis and Norton Rose Fulbright. Federal Reserve payment account proposal, 20 May 2026. FASB ASU 2023 08 and proposed Accounting Standards Update on cash equivalents and digital assets, 18 August 2026. Strategy second quarter results, 30 July 2026, and Form 8 K, 8 September 2026; Tesla quarterly filings, 2026. Circle and Tether reserve reports, mid 2026; Federal Reserve FEDS Note on Silicon Valley Bank and stablecoins, 17 December 2025. United States Department of Justice on Terraform and Celsius. FBI on the Bybit theft, 26 February 2025. Chainalysis and TRM Labs annual theft reports, attributed as their own estimates. Bank for International Settlements Annual Economic Reports, June 2025 and June 2026, and BIS Quarterly Review, DeFi risks and the decentralisation illusion, December 2021. European Central Bank working paper 3208 on concentration in DeFi governance, March 2026. CFTC v Ooki DAO, default judgment, Northern District of California, 8 June 2023. Basel Committee cryptoasset standard and 2025 review. Financial Stability Board peer review, October 2025, and cross border payments remarks, July 2026. MiCA application dates from Norton Rose Fulbright. FCA and Bank of England policy statements, June 2026, with analysis from Skadden and Freshfields. Hong Kong Monetary Authority licences, April 2026. Ripple press release and OCC conditional approval letter, 12 December 2025; NYDFS approval of RLUSD, 10 December 2024, as reported by CoinDesk. Swift press release, 9 July 2026; Standard Chartered and HSBC press releases, 19 August 2026. Visa, Making sense of stablecoins, with Allium, 2025. American Express second quarter 2025 earnings call as reported by Payments Dive. Sky (formerly MakerDAO) rebrand as reported by The Block, August 2024. Yield, pool and protocol counts from DefiLlama, 9 September 2026; Sky Savings Rate from sky.money; Aave risk parameters from the Aave risk documentation; Uniswap fee tiers from the Uniswap developer documentation; network fee from the Etherscan gas tracker, 9 September 2026. Senate Select Committee on Australia as a Technology and Financial Centre, final report, October 2021, with analysis from Allens and Chris Berg on the DAO recommendation. Bitcoin supply and halving from bitcoin.org, the Reserve Bank of Australia explainer on cryptocurrencies and Blockchain.com; Ethereum energy figures from the Ethereum Foundation and ethereum.org; Cambridge Centre for Alternative Finance digital mining report, April 2025; Lido and ethereum.org for staking yields; ATO guidance on staking rewards and airdrops and draft rulings TR 2026/D1 and TD 2026/D2, August 2026; ASIC Moneysmart on keys and custody; Bybit incident timeline and FBI alert, February 2025; Chainalysis on bridges and oracle manipulation, 2023; TRM Labs, 1 July and 31 August 2026; Betashares and ASX for the listed funds; Sky governance records for the savings rate. Market figures from DefiLlama on the date shown.