By
Mayowa Adebajo
February 14th, 2024
Already $30 million worth of A$DC have been minted by ANZ bank, after Victor Smorgon Group, a large family office based in Australia paid the money.
Fireblocks, a global digital asset custodian, worked together with Australia and New Zealand Banking Group (ANZ) to create the first AUD-pegged stablecoin. Reportedly, already $30 million worth of A$DC have been minted by ANZ bank, after Victor Smorgon Group, a large family office based in Australia paid the money to Zerocap.
This marks an important milestone of cryptocurrency adoption in Australia. Moreover, institutional investors are more likely to use regulated channels to access the crypto market.
“An ANZ issued Australian dollar stablecoin is a first step in enabling our customers to find a safe and secure gateway to the digital economy,” said ANZ Banking Services Portfolio Lead Nigel Dobson in a press release.
More regulated banks are expected to follow a similar path, according to Michael Shaulov, CEO of Fireblocks. Furthermore, blockchain technology has shown transparency can be guaranteed without compromising security.
“Stablecoins are a new way for customers to transact and in this case was an efficient and direct way for Victor Smorgon Group to access Zerocap’s digital asset exchange and move funds across a decentralized network,” Mr. Dobson added.
While most of the stablecoins in the market are focused on retailers, A$DC is not. Notably, the project was intended to be used by institutional and private investors.
Reportedly, the bank worked closely with Chainalysis and OpenZeppelin to create a stablecoin smart contract. Built on the Ethereum ecosystem, the bank intends to venture into other chains including Hedera.
ANZ and the Stablecoin Market
ANZ’s move to release a stablecoin backed the Australian dollar changes a whole scope of view. Utmost, it has shown banks can work with blockchain technology without eliminating either. Moreover, they complement each other’s existence.
“Until A$DC, we have not had a bank-backed Aussie dollar stablecoin, and most of the industry utilizes non-bank and often unregulated USD stablecoin. Now with this Big 4 bank-issued AUD stablecoin, the use case is much more compelling,” Zerocap CEO Ryan McCall told Cointelegraph.
There are notable benefits that the Australian crypto community is set to benefit from, with an introduction of an AUD-pegged stablecoin. Among them is the ability to access the crypto market with minimal transactions. Which translates to more crypto adoption in the Australian market.
The stablecoin market is vital to the crypto market, especially during higher volatility periods. Crypto traders can hedge against volatility with easily accessible stablecoins that have deep liquidity. Nevertheless, the stablecoin market is under scrutiny on its effect on CBDCs by most governments.