Tokenised infrastructure could help super funds manage cash, liquidity and investment operations as benefit payments rise, Justin Chapman, executive vice president and group head of strategic partnerships, digital assets and financial markets at Northern Trust told Super Review.
As the superannuation system manages around $4.8 trillion, Chapman said benefit payments grew more than 12 per cent last financial year and sees shorter settlement cycles as one way funds could improve cash management.
“Shorter settlement cycles mean less cash sitting idle and sharper liquidity management,” Chapman said.
He added that shared, real-time records could also reduce reconciliation and support more frequent, accurate unit pricing.
Access to investments could change too, with Chapman stating “more efficient access to private markets and real assets broadens the opportunity set” and those benefits should ultimately reach members through “lower costs, greater transparency and better outcomes”.
Project Acacia has provided one setting to explore the infrastructure as the RBA and the Digital Finance Cooperative Research Centre’s project examined 20 wholesale use cases, including Northern Trust’s simulation of synchronised delivery-versus-payment settlement for tokenised carbon credit transactions.
Chapman said the exercise showed existing Exchange Settlement Accounts could support tokenised settlement.
“You don’t need to wait for digital cash such as stablecoins or deposit tokens to start.” he said and added that a super fund trustee working with Northern Trust on the use case, “put real investor needs at the core.”
The broader framework is also developing with the Digital Assets Framework Act receiving Royal Assent in April and is due to bring digital asset platforms and tokenised custody platforms within the financial services licensing regime from April 2027.
The RBA has consulted on how its Reserve Bank Information and Transfer System could fit into a tokenised ecosystem.
In regard to trustees, the potential operational gains would not change their responsibilities, according to the firm.
“The same bar as traditional assets; not lower. A trustee’s fiduciary duty doesn’t change because an asset sits on a ledger,” Chapman said.
Funds would need clear accountability for platform operators and key controls, as well as certainty about the legal rights attached to tokens. Chapman said custody arrangements would need asset segregation, bankruptcy remoteness and a regulated custodian standing behind the asset.
Member data would also need to remain private and secure across shared infrastructure, while funds would expect assets to move between platforms rather than become trapped on one.
Chapman further told Super Review that legal certainty on settlement finality, interoperability and trusted ways to move between cash and tokens are yet to be resolved.