This $50 billion Australian bank is making a big bet on tokenization
ANZ, which manages $1.09 trillion, just took a major step in bridging the worlds of cryptocurrency and traditional finance.
Australia and New Zealand Banking Group (ANZ), which is valued at nearly $50 billion, has successfully transacted its Australian-dollar stablecoin A$DC using Chainlink’s cross-blockchain protocol.
“As a bank, ANZ sees real value in what could be achieved with tokenized assets,” Nigel Dobson, the bank’s portfolio lead, said in a statement.
Perspective: Blockchain experimentation from such a large international bank is a major sign of growing adoption for digital assets and an indicator that more financial institutions want to transact in stablecoins.
“This is a win for the whole space and also particularly stablecoins, which is for sure a killer use case in crypto,” TheStreet Crypto’s Aaron Arnold said in the video above.
More details: ANZ utilized Chainlink’s Cross-Chain Interoperability Protocol (CCIP) to test transacting with A$DC across public and private blockchains, demonstrating the capability to tokenize real-world assets and effectively transfer them across blockchain networks.
“ANZ have just started integrating and testing the Chainlink network to send stablecoins of the Austrian dollar to and from the bank and the traditional financial world,” explained Austin Arnold.
Chainlink is one of the blockchain industry’s largest projects, designed to provide interoperability between networks as a “decentralized oracle.”
“The use case here is: blockchains in general, whether it’s etheruem, whether it’s cardano… they’re decentralized, permissionless to different degrees, but in order to have DApps on top of them … they do need to pull data from off-chain to be utilized in the applications,” explained Austin Arnold. “Now, one oracle that they could just pull from, that’s a point of failure… What Chainlink offers is a decentralized oracle network, allowing these smart contracts, these decentralized applications to keep as much of the decentralization as possible as they pull this data from the outside world.”
Key takeaways: ANZ’s experimentation with CCIP is a strong sign that large banks and financial institutions see the value in tokenizing the real-world assets that they manage. In this case, that was demonstrated with ANZ’s Australian dollar stablecoin, A$DC.
“Tokenized assets are already changing the way banking works and the technology has the potential to do more — if the right pieces can come together,” Dobson’s statement read. “Banks are increasingly exploring use cases involving tokenized assets, with 93% of institutional investors believing in their long-term value, according to a recent EY report.”
The context: Several recent headlines show that financial institutions around the world are seeking to capitalize on cryptocurrencies and other digital assets.
- BlackRock, which manages $9 trillion in assets, is waiting for approval to offer a spot bitcoin exchange-traded fund (ETF).
- Nomura, which has nearly $500 billion in assets under management, just announced a bitcoin adoption fund designed to offer its clients exposure to the original cryptocurrency.
Read more about how institutional capital can drive the crypto market.
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