Racing Towards Crypto Opportunity in Singapore

As Singapore was abuzz with the excitement of the Formula One weekend in mid-September, the Token2049 conference drew attention from the crypto community. Amidst the fervor, DBS Bank, a prominent regional banking giant headquartered at Marina Bay Sands, held a unique position.

While it possesses all three licenses required to facilitate the purchase of traditional securities using stablecoins, it has yet to fully embrace this opportunity, unlike its competitors.

MetaComp, the only other entity in Singapore with all three licenses, made headlines by allowing its clients to pay for securities with their crypto holdings. However, they achieve this by initially converting stablecoins to fiat currency. DBS Bank, on the other hand, remains cautious in this crypto triathlon.

Evy Theunis, the head of digital assets at DBS’ institutional banking group, responded to queries about their measured approach. She likened their strategy to a triathlon, saying, “While it’s still winter, we have been swimming. Maybe it’s fair to suggest we’re not going as deep as some of the very focused players, but we’re still doing a lot, getting our hands dirty for the long run.”

The technical challenge behind DBS not offering stablecoin services is related to how they track tokens they process. For non-stablecoin cryptocurrencies, DBS meticulously traces every wallet the token has ever interacted with before including it in their system. However, stablecoins, which operate on multiple blockchains and cross bridges, presented a unique challenge in this regard. As a result, DBS has limited its offerings to cryptocurrencies like Bitcoin (BTC), Ether (ETH), XRP, Bitcoin Cash (BCH), DOT, and ADA to ensure the highest level of security.

In the world of finance in the Asia-Pacific region, DBS Bank stands as a major player, akin to the renowned Eliot Kipchoge in the field of long-distance running. While not the reigning champion in the digital assets triathlon, DBS knows how to secure its position. The bank’s reputation as the “safest bank in Asia” for 14 consecutive years lends significant credibility to the crypto space every time it takes a step towards integration.

DBS initiated its digital asset platform, DBS Digital Exchange, in 2020. According to Theunis, they have a history of venturing into new domains early to monitor how they evolve. In a panel at Token2049, she revealed that digital assets under custody at DBS had grown approximately 150% year-on-year by the end of the second quarter. In comparison, during the same period, Bitcoin and Ether prices increased by 50% and 80%, respectively.

Evy Theunis, with her unique background, bridges the gap between Western and Eastern understanding of crypto. Originally from Brussels, she has been based in Singapore for nearly a decade and emphasizes the significance of close collaboration between regulators and the industry. She views this relationship-led approach as a key driver of innovation, setting an example for other jurisdictions.

With the Singapore government-owned Temasek Holdings as its largest and controlling shareholder, DBS Bank’s digital asset strategy aligns closely with regional monetary policies. This alignment became particularly evident in February 2022 when DBS’ CEO, Piyush Gupta, announced plans to launch retail digital asset trading by year-end. However, Singapore’s tightening regulations in response to the collapse of stablecoin issuer Terraform Labs and crypto hedge fund Three Arrows Capital (3AC) led to the suspension of DBS’ retail trading plans.

DBS remains focused on institutional players and the accredited investor side, with no immediate plans for retail trading of digital assets. Theunis remarked that traditional players have shown readiness but limited activity in the crypto space.

DBS also actively participates in government-related projects in the blockchain and crypto space. Projects like Orchid use programmable money for government vouchers, while Project Guardian involves a tokenized version of the Singapore dollar being exchanged for tokenized Japanese yen. Additionally, the bank completed an e-Chinese yuan transaction for a client in China and executed the first “live” transaction of electronic Bills of Lading (eBL) for shipments between Singapore and India, using non-fungible tokens (NFTs) issued on Polygon to solve historical scalability issues.

* Original content written by Coinlive. Coinbold is licensed to distribute this content by Coinlive.

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