Authors: Michael Bacina, Steven Pettigrove, Jordan Markezic, Luke Misthos
On Monday, the Australia and New Zealand Banking Group (ANZ) announced the first purchase of tokenised Australian carbon credits using its Australian Dollar stablecoin, the A$DC. The deal indicates the role that stablecoins and digital assets may play in the future of energy markets and represents another milestone in ANZ’s A$DC project.
The deal involved carbon trading platform, BetaCarbon, tokenising Australian Carbon Credit Units (ACCUs) to create digital security tokens known as BCAUs. Victor Smorgon Group then purchased the BCAUs on chain using A$DC leading to the first deal of its kind.
Using the ethereum blockchain to facilitate the transaction enabled Victor Smorgon Group to avoid traditional roadblocks such as slower settlement times and counterparty risks. The deal was expedited through the use of blockchain and digital assets, compared to the traditional method of sourcing ACCUs through, for example, the Carbon Market Institute’s Carbon Marketplace.
As BetaCarbon accepted USDC (a US-Dollar stablecoin) for its BCAUs, a market had to be created for the credits to be purchased with A$DC. This was done by a digital asset manager and custodian, Zerocap, who acted as a market maker in the transaction.
ANZ appear eager to continue their involvement in the digital transition of financial markets. ANZ’s Banking Services Lead, Nigel Dobson said:
We see this is evolving from being internet-protocol based to one of ‘tokenised’ protocols. We think the underlying infrastructure – efficient, secure, public blockchains – will facilitate transactions, both ones we understand today and new ones, that will be more efficient.
Victor Smorgon Group and Zerocap were provided with redemption rights for A$DC, ensuring the tokens could be liquidated.
