Macropod CEO Drew Bradford said the proposed Payments Systems Modernisation Bill, if passed, will formally bring stablecoins into the payments system.
“For the first time, stablecoins will have their own set of rules and a defined, fit-for-purpose market structure, rather than being forced into frameworks that are not designed for digital currencies,” Bradford said.
“This is exactly what we’ve been calling for – clarity. It also legitimises the work we’ve been doing at Macropod. Stablecoins are here – and they’re here to stay.”
The Treasury has released the first sub-tranche (1a) of draft legislation to implement Australia’s new payments regulatory framework – a move that has been described as the “most significant overhaul” of the country’s financial services regime in more than 20 years.
Tranche 1a introduces the core concepts of the new framework, including stored value facilities (SVFs), tokenised SVFs, payment instruments, payment facilitation, initiation and technology services.
Jazz Ozvald, assistant director of the Digital Asset Policy Unit at Commonwealth Treasury, praised the team behind the reforms, describing the payment reforms as “remarkably complex”.
“[This is the] most significant overhaul to Australia’s financial services regime since the Financial Services Reform Bill over two decades ago (and that’s not taking into account the parallel Digital Asset Platform Reforms),” Ozvald said in a LinkedIn post on Thursday.
“It has been a privilege to work on these reforms with the many brilliant minds that have come together to make this exposure draft bill a reality. We are really looking forward to speaking with stakeholders about it over the consultation period.”
Ozvald noted that while the exposure draft bill focuses on the regulation of payment service providers, it is also highly relevant to the Digital Asset Platform (DAP) reforms exposure draft bill.
“Payment stablecoin issuers will be regulated as tokenised stored value facilities (SVF) providers. SVFs are proposed to be included as a new type of specific financial product,” he said.
He explained that payment stablecoins themselves would not be regulated as financial products – only the tokenised SVFs, in which the funds backing the stablecoin are stored, are set to fall under that classification. Possession of payment stablecoins on behalf of another person is proposed to be regulated under the DAP reforms.
Meanwhile, the existing definition of non-cash payment facilities is set to be replaced by new financial products and services introduced under the reforms.
“This includes the new definition of non-cash funds transfer, which occurs when funds are transferred from a facility held by a payer to a payee on the instruction of either person, and the transfer does not involve the physical delivery of money in the form of notes or coins.”
Ozvald added that the definition of funds includes money, another medium of exchange prescribed by regulations, or a right to redeem either of those.
“A digital token that does not fall within these things is not intended to be covered, even if it has value. For example, digital tokens connected to tokenised SVFs are intended to be covered as funds, as they would represent, or have attached to it, a right to claim money from the tokenised SVF provider.”
Additional components, including safeguarding arrangements, exemptions, APRA powers, unclaimed monies, and the new ePayments Code, will be addressed in Tranche 1b, expected in 2026.
Lucia Uen, general manager of custody at CloudTech, described the draft legislation as a positive step forward that will help accelerate the integration of traditional finance into the cryptocurrency ecosystem.
“Stablecoins play a vital role in enabling digital asset transfers and settlements on the blockchain and are essential to advancing the tokenisation of real-world assets.
“With clear regulatory guidance on who can issue stablecoins and the framework for doing so, the market can now adopt them with greater confidence and use them more reliably for settlement purposes,” Uen said.
Crypto.com highlighted that payment use cases are playing an increasing role in the growth of stablecoins.
“They are increasingly accepted for merchant payments, remittances, cross-border transactions and faster settlement, which provides tangible value for crypto. It is also helping facilitate the mainstream adoption of cryptocurrency,” said Vakul Talwar, general manager for Australia.
The draft legislation comes as the global stablecoin market cap surpasses a significant milestone – rising above US$300 billion.
Talwar noted that the growth of stablecoins throughout 2025 has been driven by a combination of regulatory clarity, institutional adoption, increased payment use cases and the overall maturation of the cryptocurrency market.
“Regulation has certainly been a key driver, where policies like the US GENIUS Act have provided clearer legal footing for payment-stablecoins, giving issuers, financial institutions and users more confidence in how stablecoins will be treated under financial, currency and securities laws,” Talwar said.
“Corporates, financial institutions and payment platforms are increasingly using stablecoins for liquidity management, settlement, cross-border payments and as bridges between traditional finance and decentralised finance,” he added.
CloudTech said the 48 per cent year-to-date growth in the stablecoin market cap reflects investor optimism towards a more crypto-supportive environment in the US.
“Momentum has persisted throughout the year, underpinned by the progressive rollout of legislative measures from the Trump administration aimed at establishing a clearer regulatory framework for digital assets,” Uen said.
“It is reasonable to call this a new era of institutional-enabled adoption. However, its endurance is dependent on global regulatory frameworks being implemented sensibly and infrastructure continuing to develop and scale to sustainably support a global 24/7 financial system.”
Submissions for the Tranche 1a draft legislation close on 6 November.
