Thank you for the opportunity to discuss the role that tokenised assets and money might have in shaping the future of Australia’s financial system. My remarks today will centre on three themes. I will begin by drawing out some lessons from history as they relate to the evolution of our commercial and monetary arrangements. I will then outline the opportunities and challenges arising from the tokenisation of assets and money in the digital age. The punchline here is that tokenisation offers some intriguing possibilities, but is not without its challenges and more work is needed to understand how we could yield the benefits while managing the risks. Finally, I will discuss how these issues connect to the next phase of the Reserve Bank’s strategic work program on the ‘future of money’.
Some lessons from the sweep of financial history
One lesson from history relates to the co-dependence of our commercial and monetary arrangements. We’ve seen this when commercial activity has chafed against the constraints of the existing monetary system, before new technologies enabled the monetary system to adapt and accommodate new forms of exchange.