The Singapore Fintech Festival takes place next week with central bank digital currencies (CBDCs) one of the hot topics on the agenda. Questions should raise be raised about what role such currencies would in fact play in financial systems. Singapore would appear to be an ideal market for the use of a CBDC, with its dense population, universal internet and smartphone penetration with propensity of digital payments at the expense of cash.
Indeed, the Monetary Authority of Singapore (MAS)’s chief fintech officer, Sopendu Mohanty, said earlier this year that Singapore’s financial sector has the technology in place to use a digital currency, with a decision by the central bank the only thing holding it back.
“What we’re missing is the decision of a central bank to issue a digital currency into the network,” Mohanty said on a R3 webinar.
“I think it will take some time, but hopefully as soon as possible.”
Singapore has the infrastructure in place, given the MAS’ work in Project Ubin, which aims to use blockchain technology in the clearing and settlement process between the central bank and commercial banks or corporates.
“Project Ubin has worked with the financial industry and blockchain community on a journey of experimentation, prototyping and learning,” Mohanty said after the MAS successfully completed Project Ubin’s final phase of testing in July.
“This has built a strong foundation of knowledge, expertise and experience, and paved a path towards commercial adoption. Following the successful experimentation over five phases, we look forward to greater adoption and live deployment of blockchain technology.”