A whitepaper on the guidelines for using digital currencies like CBDCs and stablecoins was published by the Monetary Authority of Singapore with input from significant tech companies.
In an effort to strengthen the position of digital currencies in the upcoming financial system, the Monetary Authority of Singapore (MAS) has produced a proposal for a standard protocol that outlines the requirements for using various kinds of digital currencies.
On June 21st, MAS released a whitepaper describing the technical requirements and lifecycle of their novel idea known as Purpose Bound Money (PBM). The names of the financial institutions and technology companies taking part in the PBM experiment were also made public in the whitepaper.
The PBM concept attempts to make it possible for senders of digital currencies, such as stablecoins and central bank digital currencies (CBDCs), to define transaction criteria including validity periods and permitted store types.
The chief fintech officer of MAS, Mr. Sopnendu Mohanty, stressed the favorable effect of these steps on the future of digital currencies in the financial sphere.
The International Monetary Fund, Banca d’Italia, and the Bank of Korea were among the organizations that contributed to the creation of the whitepaper. Among the fintech companies taking part in the PBM experiment are Amazon, DBS, and Grab.
Amazon will explicitly test escrow-like solutions for online retail payments, together with other players. This implies that the seller won’t get paid until the client receives the goods they ordered.
The whitepaper calls on central banks, financial organizations, and fintech firms to study the applications of digital money in more detail, highlighting the significance of ongoing research and development in this area.
As seen by recent occurrences like Circle, the provider of USDC stablecoin, gaining a license in Singapore alongside other significant payment institutions, Singapore has been actively embracing crypto-related businesses and activities.