Interviewed by Emmanuel Daniel
Stablecoins are raising pressure on bank payments and deposits, pushing ANZ and UOB to focus less on the form of digital money and more on client liquidity, settlement, asset distribution and interoperability.
For Australia and New Zealand Banking Group (ANZ) and United Overseas Bank (UOB), the next test for tokenisation is no longer simply whether a token can be issued or a transaction can settle on a blockchain. It is whether these capabilities solve client problems often enough, and at sufficient scale, to support a business. Their work suggests that commercial adoption will depend less on choosing between stablecoins, tokenised deposits and central bank digital currency (CBDC) than on making different forms of digital money useful across the networks where clients already move money and assets.
That question has become harder for banks to defer as stablecoins expand. Zhu Kuang Lee, Managing Director and Head of Innovation Group, UOB, said stablecoins have drawn banks' attention because of their potential impact on foreign exchange, cross-border transaction revenue and deposits. Building a tokenised deposit, however, is not enough if clients do not value the underlying use case. Jason Hunt, Executive Director, Industry and Innovation, ANZ, put the distinction plainly: “The customer is not really obsessed with the form of money that's being used, they really are focused on the outcome and the utility.”
Stablecoins raise the commercial stakes
UOB is placing greater near-term urgency on digital money than on tokenised securities. Lee separated stablecoins, tokenised deposits and CBDC from tokenised bonds, funds and gold, arguing that digital currency requires a more immediate banking response in Singapore. In his assessment, stablecoins have demonstrated demand for moving value quickly across networks, particularly across borders. Tokenised deposits can provide programmability and 24-hour settlement while keeping funds within an existing banking relationship, while wholesale CBDC can provide a trusted settlement asset for interbank transactions and tokenised markets. The choice of digital money is therefore driven by the use case rather than the need to identify one dominant model.
The Monetary Authority of Singapore (MAS) is also designing for that coexistence. Its Borderless, Liquid, Open, Online and Multi-currency initiative, or BLOOM, supports settlement using tokenised bank liabilities and regulated stablecoins across multiple use cases. Separately, UOB has tested wholesale CBDC transactions, including interbank payments and Singapore government securities settlement. Lee said the next challenge is to operationalise and put such capabilities into production, while the broader market still needs sufficient scale and depth to support wider adoption.
Digital money therefore becomes commercially relevant not because a bank can issue it, but because clients repeatedly choose to use it to improve payments, liquidity or settlement.
Clients care about outcomes, not the token
For ANZ, those outcomes increasingly centre on liquidity, certainty and distribution. Project Acacia, led by the Reserve Bank of Australia (RBA) and the Digital Finance Cooperative Research Centre (DFCRC), tested how digital money and tokenised settlement could support Australia's wholesale financial markets. ANZ used the programme to explore whether trade assets normally distributed among banks could also reach other pools of capital, including private wealth and family offices.
The potential value is not simply that a payable can be represented digitally. Wider distribution could give a trade bank more options for placing assets with different investors and managing the capital tied to those assets. The RBA's subsequent priorities around interoperable commercial-bank deposit tokens and commercialisation reinforce the broader point that settlement technology alone does not create a functioning market.
UOB sees a related opportunity from the investor side. Lee said private clients are not primarily asking for cryptocurrency exposure, but are increasingly looking for regulated access to tokenised investments, digital-asset custody and private-market opportunities. “One of the opportunities for banks now is actually to become the trusted orchestrator,” he said, citing banks' existing strengths in trust, custody, compliance and regional connectivity.
Taken together, ANZ's trade work and UOB's wealth observations point to distribution as one potential source of commercial value. Tokenisation matters more when it changes who can access an asset, how efficiently a bank can place it or how liquidity can move around it.
A token is not a market
The harder part is generating enough activity around the asset or payment rail. Lee identified inconsistent regulation across markets and continuing gaps in standards and protocols, while Hunt emphasised financial-market infrastructure, coordination and confidence among banks, regulators and clients. A bank may be able to issue an asset digitally and another institution may be able to settle it, but the economic value is likely to remain limited if there are too few buyers, fragmented liquidity or systems that cannot interact.
“People need to build that confidence to drive that investment, and get that collaboration to build that kind of market up,” Hunt said.
ANZ's current focus on trade assets reflects that market test. Hunt said institutions will prioritise areas where they can achieve network effects, adoption or a direct business advantage. UOB has reached a similar discipline from another direction, with Lee saying its current focus in Singapore and Southeast Asia is weighted more heavily towards stablecoins, tokenised deposits and payment rails.
Both approaches point to the same commercial sequence: a viable use case must attract participants and liquidity before interoperability can extend it across markets.
Interoperability becomes the scale test
Neither ANZ nor UOB expects one form of digital money to answer every use case. Lee argued that the more important question is which form is most suitable for a particular transaction, with coexistence and interoperability mattering more than convergence on a single model. Hunt likewise sees roles for CBDC, tokenised deposits and stablecoins depending on the outcome a client needs.
If clients and counterparties operate across several forms of money, liquidity can remain fragmented unless those systems connect. That is where Swift's blockchain-based ledger becomes relevant. Swift said in July 2026 that 17 banks across six continents were preparing controlled live pilots using tokenised deposits for 24-hour cross-border payments, with the model intended to coordinate transfers between banks' own tokenised-deposit systems while maintaining links to existing banking infrastructure.
Lee described the initiative as moving beyond Swift's traditional messaging function towards closer coordination at the settlement layer. Hunt linked the same development to a treasury problem: visibility and access to liquidity. As payments and liquidity management become more continuous, treasurers need to know where their money is and whether it is available, even if final settlement still occurs through traditional infrastructure.
Swift therefore matters less as another blockchain project than as one possible way for banks to coordinate different forms of regulated digital money. If those liabilities and networks can interoperate, banks may be able to serve client needs without waiting for one universal settlement model. Lee said UOB's starting point is what clients need and how the bank can connect to relevant network partners, while Hunt said ANZ's priority is helping clients access different sources of global liquidity rather than treating CBDC, stablecoins and tokenised bank money as competing choices.
Recurring usage will decide what leaves the pilot stage
The unresolved test for ANZ and UOB is whether these capabilities become part of normal client behaviour. A successful proof of concept demonstrates that a transaction can work. Commercialisation requires clients to return, counterparties to participate, liquidity to be available and the economics to justify the infrastructure and risk-management investment required for production.
Hunt pointed to greater private-sector engagement around liquidity over the past year as an early sign of that shift. “It's absolutely the client problems that are coming to the top of the agenda,” he said.
For banks, the commercial milestone may therefore be less another successful tokenisation pilot than the point at which clients use these capabilities as part of ordinary payments, treasury, financing or investment activity. At that point, the transaction stops being an experiment and starts becoming banking business.
Stablecoins are raising pressure on bank payments and deposits, pushing ANZ and UOB to focus less on the form of digital money and more on client liquidity, settlement, asset distribution and interoperability.
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