Australia’s top financial regulator has urged the nation to move quickly on tokenization or risk losing ground to global competitors reshaping financial markets through digital innovation.
In a speech on Wednesday, Australian Securities and Investments Commission (ASIC) Chair Joe Longo said tokenization—the process of converting real-world assets into digital tokens on a blockchain—will be central to the next phase of Australia’s financial market development.
Longo described tokenization as a “transformative” force that could make capital markets more efficient by splitting assets into smaller, tradable units and enabling near-instant settlement. But while other countries accelerate their adoption, he warned that Australia could become “the land of missed opportunity” if it fails to keep pace.
Global Momentum in Tokenization
Longo highlighted rapid advances abroad: Switzerland’s digital securities exchange has already issued more than $3.1 billion in tokenized bonds since 2021. Meanwhile, J.P. Morgan plans to fully tokenise its money market funds within two years, and Nasdaq is preparing to launch 24-hour tokenized securities trading by late 2026.
“Once, Australia was one of the early adopters of innovation in markets,” Longo said, referencing the country’s early success with electronic trading systems. “Now, other countries are outpacing us.”
ASIC to Relaunch Innovation Hub
To help close the gap, Longo announced ASIC will review and relaunch its Innovation Hub, a program designed to support financial market innovators navigating regulatory challenges. The revamped initiative will emphasize collaboration, he said, offering an “open-door policy” for fintech startups and businesses exploring new technologies.
ASIC also plans to support the government’s review of the Enhanced Regulatory Sandbox, aimed at giving fintech firms a safe space to test products and services without the full weight of regulation.
Recent Regulatory Updates
The renewed focus on tokenization follows ASIC’s updated digital asset guidance, which now classifies stablecoins, wrapped tokens, and tokenized securities as financial products requiring a license. Companies have been given until June 2026 to comply with the new rules.
Separately, the Australian Treasury recently released draft legislation that would require crypto exchanges and service providers to hold financial services licenses, signaling a coordinated effort to bring digital assets under consistent regulatory oversight.
A Race Against Time
Longo’s remarks underscore a growing urgency within Australia’s financial leadership to embrace innovation while maintaining market integrity. “We must seize the opportunity or be left behind,” he said, emphasizing that collaboration between regulators, innovators, and government will be key to keeping Australia competitive in a rapidly evolving global market.
