Singapore’s intention to become a global cryptocurrency hub will come to a greater realization this year by developing as a specific kind of hub for institutional and industry participation. Inherent in this strategy is the intentional promotion of certain aspects of growth and the restriction of others. Singapore seeks to leverage accredited investors and institutions with sufficient assets and expertise to participate in this high-risk environment, especially in the early stages of development. While this may mean discouraging participation in retail, this approach provides much-needed clarity for businesses in terms of policies that are still relatively rare in other parts of the world. We will provide
As a reputed financial center on the world map, Singapore’s efforts continue its steadfast efforts to maintain its lead in the sector. Before laying the groundwork for this year through deliberate policy and regulatory efforts made in 2022, Singapore’s approach to crypto will leverage key stakeholders for industry growth and broader financial It may serve as a blueprint for other countries looking to build effective use cases for their markets.
Aim for balance
In November 2021, Singapore’s central bank and financial regulator, the Monetary Authority of Singapore (MAS), will become a healthy and well-regulated hub for digital assets with value-added use cases. We shared Singapore’s ambitions. Efforts have been made continuously to strike a fine balance between fostering blockchain innovation and shielding investors from the risks of participating in a promising but nascent market. .
Initiatives have been introduced to enable institutions to explore decentralized finance (DeFi) applications and the concept of a digital Singapore dollar through Project Ubin, Project Orchid and Project Guardian.
The TOKEN2049 conference highlighted Singapore’s strength in bringing together financial sector professionals. Held in Singapore, the conference brought together more than 7,000 of his attendees, including venture capitalists, financial institutions, cryptocurrencies, DeFi and infrastructure projects, to discuss the future of cryptocurrencies and discuss new ongoing facilitated development.
When it comes to private sector investment in blockchain, Singapore holds the second-largest position in the world after the United States in terms of the number of transactions, with Singapore-based projects having completed 566 transactions over the past six years. and raised $3.9 billion. According to The Block’s research, only the United States and the United Kingdom cumulatively raised more money, with $38.6 billion and her $5 billion, respectively.
Investments from within Singapore through Temasek, the country’s sovereign wealth fund, also highlighted Singapore’s commitment to being a key player through investments in gaming, NFTs and other ecosystem players. .
Singapore is starting to see a shift in physical projects, not only because of its favorable business environment in terms of taxation, but also because of the rule of law and the certainty of business continuity. Crypto projects, for example, have left China following greater restrictions on business and Covid. As projects seek to decentralize their operations in trusted hubs around the world, so too are more and more blockchain node operators. We are based in Singapore.
These strengths in technology development, institutional participation and investment will shape Singapore as a cryptocurrency hub in the coming years.
Cooperation with the private sector
Last year saw a significant shift in institutional interest in cryptocurrencies and DeFi globally. BlackRock, the world’s largest asset manager, has started trading digital assets, and HSBC plans to move settlement of his US$20 billion assets to a new blockchain-based custody platform.
Just last month, Societe Generale, a French-based bank, withdrew US$7 million worth of MakerDAO stablecoin DAI from its vaults, which had been deposited with a US$30 million limit in DAI. The vault is backed by his €40 million bond in the form of the “OFH Token,” a tokenized security issued on Ethereum and backed by a AAA-rated French mortgage.
This year, there will be further investigation of permissioned DeFi, which has the potential to increase transparency among relevant stakeholders and facilitate cross-border, industry-level near-instant settlements.
Permissioned DeFi, including identity verification and identity whitelisting processes such as Know Your Customer (KYC) and Anti-Money Laundering (AML) procedures, can help financial institutions that adhere to stringent compliance rules to scrutinize counterparties. Helpful. This approach is in contrast to most of his DeFi, which is completely permissionless and essentially anyone can access the liquidity pool. In 2023, his KYC and his use of AML to expose information to centralized parties by promising to develop zero-knowledge that protects data privacy through zk-STARKs and zk-SARKS Opposing opinions can be countered.
A permissioned version of the lending protocol, Aave Arc, will be released in early 2022. Just last November, we saw a major bank tokenize deposits on a public blockchain for the first time. This historic moment has spearheaded Singapore under the supervision of MAS, with banks such as DBS Bank and JP Morgan utilizing a modified version of Aave Arc to trade foreign exchange and government bonds on Polygon. I was.
Project Mariana is also underway, involving the central banks of Singapore, France and Switzerland in research to integrate DeFi capabilities with central bank digital currencies (CBDCs). These projects are likely to make even greater progress this year.
Drive real-world use
Better integration of cryptocurrencies with the real world will also help to make the value of financial transactions more visible, such as reduced costs, increased efficiency, and reduced risk.
A government and industry initiative aimed at developing the infrastructure and technical capacity needed to issue a digital Singapore dollar, Project Orchid is a joint venture with industry partners such as DBS Bank, Central Provident Fund (CPF), Grab, UOB and OCBC. It was launched in October last year with stakeholders. HSBC, Marketnode and UOB are also partnering with MAS to develop wealth management products. Continued efforts like this will push progress locally toward useful implementations in the wider economy.
Beyond finance, we see examples in industries such as real estate, education, and healthcare. Tokenization of real estate development is made possible through the Fraxtor digital platform, bridging investors and real estate investment opportunities generated by private equity managers. In October 2022, his Fraxtor, an eligible real estate tokenization issuer, tokenized two of his redevelopment projects, including a freehold and bungalow site in Singapore. This represents a significant move towards transforming real estate, which has historically been a fundamentally indivisible and illiquid asset category.
Additionally, in the fields of education and healthcare, solutions like Accredify simplify the traditionally complex process of issuing verifiable documents that are tamper-proof and whose identities are stored on the blockchain. Beyond its initial focus on making it easy to store and share educational credentials, in late 2022, it will partner with IOT startup Beep to deliver over 1 million covid-19 rapid antigen test results. This technique was used to issue the We also have other platforms such as Opencerts, a platform that generates cryptographic protection for educational credentials, and HealthCerts, which helps provide tamper-proof, secure, digitally transmitted health certificates for convenient global travel. I’ve also seen the rise.
These use cases will help drive organic growth and more useful applications of crypto in highly valuable industries in the wider economy.
Industry and institutional engagement will remain key to Singapore’s thriving cryptocurrency hub this year, with a strong foundation built in 2022. and DeFi. Strong government support for the industry and continued entry of more blockchain professionals will contribute to the accelerating pace of growth. Singapore’s approach should be seen as a blueprint for other countries looking to grow their cryptocurrency industry and build a broader economy.