Singapore’s central bank has announced that it is considering to join hands with China to explore central bank digital currencies (CBDCs). The bank is joined by the financial regulatory authority in his venture aiming to explore the possibility of creating digital money.
The managing director of the Monetary Authority of Singapore (MAS), Ravi Menon, has explained that the country is ready to join forces with China in this sector. Menon mentioned China’s progress in the development of its CBDCs while speaking at a financial forum in Shanghai. China’s project is known as the digital Yuan.
Singapore is also actively looking for ways to develop its blockchain-based CBDCs and it is aiming to exchange related expertise and knowledge with China, according to a June 18 Sina Finance report.
Menon allegedly stated that the CBDC is currently a very popular topic. He was speaking while confirming that Singapore and the People’s Bank of China are discussing many CBDC development scenarios. He also highlighted that the reasons for developing a CBDC vary from one country to the next.
The Singapore official insisted that the primary goal of Singapore’s CBDC project is to cut across cross-border payments and settlement costs. It will reduce settlement time and guarantee transaction security.
MAS Official Supports Cooperation With Facebook’s Libra
At that event, Menon also said that Facebook’s troubled Libra project is a major challenge for the global central bank system. However, he believes that this project offers great flexibility since the entire Libra team is committed to working hand in hand with global regulators.
“We should not reject the value of Libra, but should have more discussions with them.”
Several months ago, the official voiced a similar opinion about the stand that should be taken with regards to Libra in the summer of 2019. Since its launch in June last year;Libra has encountered many regulatory challenges from governments, central banks, and authorities around the world. That extensive pressure even resulted in some of the Libra Association members abandoning the project after it got launched.
Since late 2016, the Monetary Authority of Singapore has been working on its in-house blockchain-powered interbank payment project. It was officially unveiled in 2018 and it was referred to as ‘Project Ubin’. The project is a collaborative effort. It aims to explore different uses of blockchain for clearing and settlement of securities and payments.
China’s Digital Currency Can Rival Libra And USD
In June 2019, China’s central bank was allegedly racing to unveil its digital yuan ahead of Facebook’s Libra. Experts are confident that China can launch its digital yuan without the citizens noticing any significant changes. The digital Yuan is allegedly already being tested in some cities.
It was also reported in mid-June that China is also planning to launch an East Asia digital currency; to gain more independence from the United States dollar. The planned digital currency would purportedly include a large basket of the regional currencies; like the Japanese Yen, Chinese Yuan, Hong Kong dollar, and South Korean Won.