The launch of AUDM in September 2025 is already changing the Australian digital payments sector. Issued by Macropod, a joint venture between MHC Digital Group and Catena Digital, the stablecoin is the country’s first fully regulated token that is pegged to the Australian dollar. Its launch followed ASIC’s decision to ease the distribution requirements for issuers.
Stablecoins now reach tens of billions of dollars in daily volume and an annual transfer volume that exceeds Visa and Mastercard. However, most of these come from USD-denominated tokens like Tether’s USDT and Circle’s USDC.
AUDM has come in to provide Australian merchants with the first licensed AUD stablecoin, and they can freely and safely transact with it to reduce foreign exchange costs from cross-border transactions.
The Impact of AUDM on the Market
As the first licensed AUD stablecoin, AUDM is expected to show how regulated stablecoins could function in the country.
Unlike other AUD pegged tokens like AUDT, AUDD, and AUDX, AUDM already has wider accessibility in traditional financial institutions, as its licensing also means credibility. The government has also given it an exemption from various regulations, which has empowered the stablecoin to take on the market.
Faster Processing Time
AUDM provides Australians with faster processing time, especially for cross-border transactions. The token offers 24/7 programmable settlement, allowing merchants to avoid the slow batch cycles used by banks and card payment providers.
“These digital tokens pegged to stable assets like the US dollar can be transferred globally in seconds, without relying on a chain of correspondent banks,” wrote Carl Garrett, Head of Global Cross-Border Product at ANZ.
Transactions made through payment cards can take hours and sometimes even longer to go through. Cross-border transactions going through SWIFT, for example, involve multiple intermediaries, which can cause settlement delays. It’s the same story when it comes to remittances.
Last year, Australian Fintech Stables enabled its thousands of users to send remittances from Australia to the Philippines using stablecoins. “This is the first time in Australian history that a company has embedded stablecoins in remittance rails with both domestic jurisdictions covered to deliver a payload with no middlemen, intraday with sub-1% fees. We cannot wait to bring feature parity to the Philippines by May 2024,” co-founder and CEO Erez Rachamim said at the time.
Stable uses Circle’s USDC, but with the launch of regulated Australian dollar-denominated stablecoins, the company can help its customers lower their FX costs. AUDM settles transactions almost instantly. Payments are verified and transferred on-chain without the need for third-party reconciliation, making it particularly valuable for businesses.
Regulatory Confidence
One thing that has been holding AUD-pegged tokens back is a lack of regulatory confidence. AUDM has satisfied all regulatory requirements set by the Australian Financial Services Licence (AFSL) and publishes monthly financial data, ensuring transparency.
Offers a Bridge to Blockchain Infrastructure
AUDM also provides Fintechs with APIs for programmable payments in the Australian dollar. “Stablecoins are already the fastest-scaling asset class in financial history, and demand from exchanges, wealth platforms and fintechs for compliant Australian dollar rails is at an all-time high,” said Mark Carnegie, founder and Executive Chairman of MHC Digital Group. “Macropod will deliver the trust, scale and connectivity institutions have been waiting for.”
What Banks Must Reconsider
For banks, the arrival of AUDM undoubtedly offers competition. But it’s not all negative. As seen with US banks like JP Morgan and Bank of America, embracing stablecoins can open new opportunities. JP Morgan Chase is making plans to launch its own token, and other US banks are already collaborating with issuers.
Australian banks will likewise need to decide whether to integrate AUDM or risk ceding ground to Macropod and newer issuers of AUD-pegged tokens. Before founding Macropod, both Drew Bradford and CTO Rob Waugh worked at NAB, where they created a stablecoin. Ultimately, the bank chose not to launch it.
Opportunities and Challenges for Merchants
Merchants are set to benefit from AUDM’s faster settlement and lower fees. Using the Australian dollar-denominated token over a US dollar-denominated USDT can reduce conversion fees.
But merchants must also invest in payment infrastructure that supports the stablecoin. For smaller sellers and buyers, this expense is an unwelcome challenge. Alternatively, merchants can switch to payment processors that offer AUDM integration.
But that’s just a small part of the work they need to do. The bigger task is convincing customers to adopt it as well. Given that stablecoins are still new in Australia, this requires trust. To get there, businesses will need to spend time and money educating customers on both the safety and benefits of stablecoins.
Merchants must also keep an eye out to ensure they remain compliant. While stablecoins are regulated, laws can evolve.
Longer-Term Impacts
AUDM is barely two months old, but if its adoption and other Australian dollar-pegged stablecoins continue to gain traction, there could be a seismic shift in how payment systems operate. Traditional payment processors could find themselves forced to innovate and offer lower fees. After all, the biggest draw to stablecoins so far has been their low transaction fees.
Merchants who make frequent transactions can save a lot of money by simply switching from the 2 to 6 per cent fees offered by traditional payment providers to the near-zero fees you get with AUDM. Some providers also include a margin on the exchange for large transactions, which can significantly drive up costs. Additionally, AUDM’s efficiency could reduce the cost of capital tied up in transit or intermediated settlement.
As for banks, those that adapt may issue their stablecoins to their customers or act as custodians of stablecoin systems. The ones that do not may find themselves sidelined beyond just payments.
