The Arrival of Tokenization on Blockchain for Institutions: Insights from Redbelly Network's AMA

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Key Takeaways

Institutions are moving away from outdated processes like email confirmations and spreadsheets.
Redbelly Network and AMAL Trustees advocate for tokenization as a strategic upgrade for asset management.
Project Acacia demonstrates how tokenized assets and wholesale Central Bank Digital Currency (CBDC) can simplify various financial operations.
Deterministic finality and zkIdentity are crucial for ensuring secure and reliable transactions in tokenized markets.
The partnership between Redbelly and AMAL/IQ-EQ merges technical capabilities with compliance to reshape asset lifecycles.

Tokenization arrives onchain for institutions — AMA recap with Redbelly Network

Security, Finance, CBDC, RWA, Tokenization

During a recent AMA hosted by Cointelegraph, key experts from Redbelly Network discussed how tokenization could revolutionize institutional asset management by streamlining workflows and enhancing operational efficiency. Alan Burt and Luke Andersen emphasized the importance of modernizing financial infrastructure to keep pace with the changing landscape of capital markets.

Transforming Institutional Tokenization

The conversation opened with a discussion of the current state of institutional tokenization. In the last couple of years, asset administrators, service providers, and central banks have transitioned from experimental projects to fully operational solutions. Redbelly is primarily focused on regulated markets and private credit, areas still heavily reliant on isolated databases and manual workflows.

Burt pointed out that Redbelly aims to integrate the benefits of decentralized finance (DeFi) into regulated spaces, establishing layers for identity and custody that allow for the movement of collateral within existing frameworks. He highlighted private credit and alternative assets as initial sectors where tokenization can modernize processes and facilitate wider access over time.

Andersen noted that for AMAL and IQ-EQ, tokenization has evolved from a mere innovative concept to a critical consideration at the board level: “Tokenization is no longer viewed as a speculative concept but rather an essential infrastructure enhancement that executives are keenly investigating.”

Insights into Project Acacia: Implementing Smart ABS and CBDC on a Public Blockchain

A focal point of the AMA was Project Acacia, a pilot for a CBDC by the Reserve Bank of Australia, wherein Redbelly, alongside AMAL/IQ-EQ, introduced a smart asset-backed security (ABS). The initiative aimed to demonstrate how tokenized assets combined with wholesale CBDC can streamline processes such as issuance, servicing, reporting, and secondary trading.

Burt described the traditional securitization flow, where an originator manages a loan portfolio while banks handle funding and trustees oversee payments to various investor groups. Each party typically operates separate systems and reconciles data monthly. With Project Acacia, they transitioned the underlying loans, ABS structures, and secondary trading activities to integrated infrastructure.

“This allowed us to connect the originator, warehouse, and trustee on a unified platform, enabling secondary trading on the Australian Bond Exchange,” Burt explained. “Participants gain clarity on what they hold and can trace the underlying assets before pricing or making any adjustments.”

Andersen expressed that this pilot exemplifies the trustee's essential role in tokenized markets, demonstrating how fiduciary responsibilities and digital transactions can work in harmony. Tokenization enhances trust law and investor protection while expediting processes, minimizing manual inputs, and replacing traditional document flows with automated rules and straightforward settlements.

Understanding Deterministic Finality and zkIdentity

The discussion progressed to cover the essential infrastructure needs and risk management strategies. Institutions require more than just throughput; they need predictable costs, accountability for audits, and assurances that transactions finalize in a definitive manner.

Burt described Redbelly’s deterministic consensus model and fixed gas fees tailored for capital market demands. All validator nodes collaborate to propose transactions, establishing a “super block” prior to its commitment, thereby eliminating forks and minimizing risks. This approach, developed with research from the University of Sydney and CSIRO, Australia’s national research body, boasts a performance benchmark exceeding 97,000 transactions per second without any transaction loss during stress testing.

“Settlement is the core strength of our network,” Burt emphasized. “Institutions must be assured that once a block is created, there are no rollbacks, and every transaction follows the correct sequence.”

Both Burt and Andersen stressed the importance of Redbelly's zkIdentity system, which helps avoid repetitive Know Your Customer (KYC) and eligibility verifications across platforms. Users receive verifiable credentials that confidentially confirm their compliance with product requirements or regulations. Eligibility is assessed at the network level, ensuring that private data remains secure while allowing issuers to operate within regulatory frameworks.

For AMAL/IQ-EQ, this innovation resolves critical compliance challenges. Andersen remarked, “zkIdentity enables us to validate eligibility at the network level while safeguarding private information, allowing regulated markets to function efficiently on public infrastructure with necessary controls.”

The collaboration between Redbelly and AMAL/IQ-EQ merges technical innovation with established regulatory frameworks, financial strength, and transaction setups. AMAL Trustees contributes fiduciary oversight and legal accountability, while Redbelly supplies the shared ledger, deterministic settlements, and identity solutions. Together, they position tokenization as a transformative upgrade for managing and financing asset lifecycles.