The Monetary Authority of Singapore (MAS) has announced its partnership with global financial regulatory authorities, including the Financial Services Agency of Japan (FSA), the Swiss Financial Market Supervisory Authority (FINMA), and the United Kingdom’s Financial Conduct Authority (FCA).
These collaborative efforts will aim to tackle potential risks and deficiencies in current regulations related to tokenised solutions.
Deputy Managing Director of Markets and Development at MAS, Leong Sing Chiong, stressed that the international collaboration with FSA, FCA and FINMA highlights a shared enthusiasm among regulators to understand the opportunities and risks associated with digital asset innovations.
This move builds on Singapore’s continued dedication to asset tokenisation, demonstrated through Project Guardian’s launch in 2022
Singapore has expressed its ambition to become a digital asset hub.
Ravi Menon, Managing Director of Central Bank of Monetary of Singapore, mentioned in his opening address at the Singapore Fintech Festival 2022:
“If a crypto hub is about experimenting with programmable money, applying digital assets for use cases or tokenizing financial assets to increase efficiency and reduce risk in financial transactions, yes, we want to be a crypto hub,”
Singapore has demonstrated its support for blockchain technology through various projects, including Project Ubin, which recently concluded its successful trial employing blockchain for payments and securities clearing and settlement.
Furthermore, Project Guardian, in its initial collaboration with 15 financial institutions, showcased enhancements in market transactions through the tokenization of assets.
It conducted its inaugural industry pilot, where DBS Bank, JPMorgan, and SBI Digital Assets Holdings facilitated transactions in tokenised foreign exchange and government bonds.
MAS Global Digital Asset Initiatives
Singapore has been actively engaging in global digital asset initiatives prior to this recent collaboration.
In September 2023, MAS completed a joint test for cross-border trading and settlement of wholesale central bank digital currencies, in partnership with the Bank for International Settlements, and the central banks of France and Switzerland.
These efforts not only showcase MAS’s involvement but also signify a shift in the digital asset regulatory landscape.
While the collaboration primarily focuses on fixed income, foreign exchange, and asset management products, it holds broader implications such as exploring regulatory sandboxes for testing new concepts, and fostering open dialogue between international policymakers.