The Monetary Authority of Singapore (MAS) has proposed ways to design open, interoperable networks for tokenised digital assets, and released a report [pdf] to establish international standards that promote safe and efficient financial market infrastructure.
MAS presented the framework in collaboration with the Bank for International Settlements’ (BIS) and other financial institutions.
The central bank’s initiative - Project Guardian, aims to explore the potential of asset tokenisation for a wide range of financial asset classes.
It has formed the Project Guardian Industry Group, a consortium of 11 financial institutions including HSBC, Standard Chartered, DBS, and Citi Bank to conduct pilot studies in wealth management, fixed income, and foreign exchange, for advancements in Singapore's financial landscape.
MAS’ deputy managing director (markets and development), Leong Sing Chiong, said while MAS restricts speculation in cryptocurrencies, there is potential for value creation and efficiency gains in the digital asset ecosystem.
For instance, Standard Chartered, along with payments platform Linklogis is developing an initial token offering platform to issue asset-backed security tokens listed on the Singapore Exchange, he said.
Asset-backed tokenisation refers to the process of converting real-world assets into digital tokens on a blockchain or distributed ledger technology (DLT) platform.
According to MAS, Japan Financial Services Agency (JFSA) becomes the first overseas financial regulator to join Project Guardian and collaborate on digital asset innovation and best practices for asset tokenisation.
Last week, MAS proposed a common protocol specifying conditions for the use of digital currencies as financial institutions get ready to trial what MAS calls purpose-bound money (PBM).
