Singapore’s MAS Unveils Groundbreaking Initiatives for a Digital Money Future

The Monetary Authority of Singapore (MAS) has introduced three key initiatives, including a digital Singapore dollar blueprint, expanded digital money trials, and the issuance of a “live” CBDC for wholesale settlement, signaling a significant advancement in the country’s digital monetary landscape. These initiatives aim to ensure secure and innovative digital money utilization, encompassing components such as tokenized bank liabilities, wallet interoperability, supplier financing, and institutional payment controls.

17 November 2023 – The Monetary Authority of Singapore (MAS) has introduced three pivotal initiatives to ensure the secure and innovative utilization of digital money within the country. These initiatives encompass the formulation of a blueprint outlining the infrastructure for a digital Singapore dollar, the expansion of digital money trials, and the issuance of a “live” central bank digital currency (CBDC) for wholesale settlement, marking a significant step in Singapore’s digital monetary landscape.

The Orchid Blueprint, published by MAS, delineates the requisite technology infrastructure for future digital money transactions, building upon insights from the Project Orchid industry trials. The blueprint identifies crucial components, including a settlement ledger for recording digital money transfers with native programmability, a tokenization bridge to link existing settlement systems with tokenized digital money ledgers, a programmability protocol utilizing Purpose Bound Money (PBM), and a Name Service for translating complex wallet addresses into readable and meaningful alternatives.

In an effort to test the broad applicability of Purpose Bound Money (PBM) and digital money, MAS is set to expand Project Orchid’s digital money trials with industry players. The trials will include exploring the feasibility of enabling tokens issued by one bank for retail payments by another, testing wallet interoperability, examining supplier financing through tokenization, and exploring institutional payment controls.

Additionally, MAS is commencing the development of a central bank digital currency (CBDC) for wholesale interbank settlement, with plans to pilot the “live” issuance of wholesale CBDCs for retail payment settlement between commercial banks. This marks a significant advancement in MAS’ digital money journey since 2016 and reinforces the central role of central bank money in facilitating secure and efficient payments.

Mr. Ravi Menon, Managing Director of MAS, stated, “The ‘live’ issuance of central bank digital money for use as a common settlement asset in payments is a significant milestone in MAS’ digital money journey that began in 2016. The issuance of wholesale CBDC reinforces the role that central bank money plays in facilitating safe and efficient payments.”

Author: Terry KS

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