Singapore Advances in Tokenised Finance: Trials, Regulations, and Collaborations

Singapore's central bank, MAS, will trial tokenised MAS bills next year and implement stablecoin regulations to enhance a secure tokenised financial ecosystem. Collaborations with international banks for cross-border digital transactions are ongoing, alongside developing a regulatory guide for tokenised capital markets.

Singapore's central bank, the Monetary Authority of Singapore (MAS), is set to trial the issuance of tokenised MAS bills next year while introducing legislation to regulate stablecoins, according to an announcement made on Thursday.

Chia Der Jiun, Managing Director of MAS, highlighted the potential of tokenisation in his keynote at the Singapore FinTech Festival, stating that although progress has been made, asset-backed tokens haven't fully taken off yet. The MAS plans to draft stablecoin legislation focusing on firm reserve backing and reliable redemption processes.

MAS is exploring the BLOOM initiative, overseeing trials for the use of tokenised bank liabilities and regulated stablecoins for transactions. It achieved a milestone with the first live trial of Singapore dollar wholesale CBDC interbank lending among DBS, OCBC, and UOB. Collaborations with other central banks, including those of England and Thailand, are underway to enhance liquidity and streamline real-time, secure cross-border transactions. Moreover, a memorandum with Deutsche Bundesbank aims to improve digital asset settlement.

(With inputs from agencies.)