The Monetary Authority of Singapore (MAS) is moving tokenization from the “lab” to the ledger, announcing a pilot program to issue tokenized MAS bills settled using central bank digital currency (CBDC). This move is a significant stride toward embedding blockchain-based assets into the core of Singapore’s financial system.
MAS Managing Director Chia Der Jiun, speaking at the Singapore FinTech Festival, affirmed that tokenization is past the purely experimental phase, noting, “Are asset-backed tokens clearly out of the lab? Without a doubt.” However, he cheekily added that they haven’t “achieved escape velocity… yet.”
The momentum isn’t just regulatory. MAS revealed that three of the nation’s banking heavyweights—DBS, OCBC, and UOB—have successfully tested interbank overnight lending transactions using the Singapore dollar wholesale CBDC. This signals growing, real-world adoption and aligns with the MAS goal of scaling tokenized finance on reliable, regulated assets. Details on this trial are due next year.
Chia conceded that while tokenized assets offer instant settlement and optimized collateral use, “broader ecosystem still faces significant operational and structural challenges before mass adoption can occur.” Progress, not perfection, seems to be the current mantra.
On the regulatory front, MAS is close to drafting legislation based on its stablecoin framework, introduced in August 2023. The framework focuses on single-currency stablecoins pegged to the Singapore dollar or major global currencies. Chia stressed the importance of “sound reserve backing and redemption reliability,” recalling that unregulated stablecoins have had a “patchy record” and pose systemic risk.
To further industry exploration, MAS has launched the BLOOM initiative to spur trials involving tokenized bank liabilities and regulated stablecoins, cementing Singapore’s bid to lead in safe, scalable tokenized finance.
