Kenne Michael 
The Reserve Bank of Australia (RBA) is open to the use of a central bank digital currency (CBDC) as the future of money, with state-issued digital money representing a tokenized form of central bank reserves.
In a speech titled “A Tokenised Future for the Australian Financial System,” RBA assistant governor (financial system) Brad Jones discussed the opportunities and challenges presented by the tokenization of assets and money in the digital age and shed light on the proposed plan to use CBDCs as a form of currency.
Jones began his address by describing the historical use of various forms of money and the evolution of financial instruments.
Notably, Jones mentioned stablecoins and CBDCs while discussing tokenization and tokenized monetary systems in the modern era.
He stated that stablecoins issued by “well-regulated financial institutions and that are backed by high-quality assets (i.e., government securities and central bank reserves) could be widely used to settle tokenized transactions;” however, due to lack of regulatory guidelines, stablecoins issued by private parties often come with increased risk.
According to Jones, however, CBDCs in the form of tokenized bank deposits could become a viable form of transaction settlement.
Given that deposits issued by various banks are already widely exchanged and settled (at par) across the central bank’s balance sheet, the assistant governor added that instituting tokenized bank deposits would be a minor deviation from current practice.
A payment between two parties utilizing tokenized deposits would continue to be settled via a transfer of exchange settled (or wholesale CBDC) balances between the payer and recipient bank.
Jones also presented some findings from the central bank’s pilot CBDC program, including various areas where CBDC could add value to wholesale payments, such as facilitating atomic settlement on tokenized asset markets.
The pilot project also revealed opportunities for a wholesale CBDC to complement new forms of privately issued digital currency, such as tokenized bank deposits and asset-backed stablecoins.
