Singapore vows to crack down on dodgy crypto players as its CBDC project advances.
Singapore pledges to take ‘brutal and unrelentingly hard’ action on shady operators in the crypto space while it embraces fast cross-border payments in central bank digital currencies.
Singapore’s Monetary Authority (MAS) has warned crypto cowboys that they face a rough ride in the island nation having recently welcomed the launch of a local Center Of Excellence focused on crypto-inspired central bank digital currencies (CBDCs).
Singapore has a considerably favourable legal framework for the setting up of crypto projects and according to golden.com, is home to over 400 of the world’s top crypto projects including some of the world’s leading exchanges like Bybit and Crypto.com.
The Center Of Excellence (COE) was set up by an open-source effort to create payment platforms to make digital financial services accessible to those access to banks known as the Mojaloop Foundation.
The COE aims to accelerate financial inclusion in emerging markets through hackathons, workshops and pilot projects while examining expanded CBDCs payment capabilities.
MAS Chief Fintech Officer Sopnendu Mohanty serves as a board advisor for the Mojaloop Foundation alongside folks from the Bill & Melinda Gates Foundation, Google and more with Singapore’s sovereign wealth fund also invested in the foundation.
The FinTech boss praised the COE and Foundation as “a step forward into the future of financial services,” and stated that MAS will support the COE’s efforts to “foster greater international collaboration in enabling more seamless cross-border transactions.”
Singapore’s digital curiosity is evident in its CBDC-tested cross-border payment interoperability tests with South Africa, Australia and Malaysia.
The country’s deputy prime minister Heng Swee said that these tests “validated various design approaches through prototyping” and its resulting recommendations would “support the G20 roadmap for enhancing cross-border payments.”
However, Mohanty expressed reservations about the more liberal use of digital currencies.
According to The Financial Times, Mohanty said, “We have no tolerance for any market bad behaviour. If somebody has done a bad thing, we are brutal and unrelentingly hard.”
Mohanty doubled down saying, “We have been called out by many cryptocurrencies for not being friendly, My response has been: friendly for what? Friendly for a real economy or friendly for some unreal economy?”
In addition, Mohanty forecasted that Singapore will launch a government-backed alternative within three years, blaming private cryptocurrencies for market instability like the $40 billion Luna not-so-stablecoin crash.
According to Mohanty, initiatives like Mojaloop are more appealing to Singapore. He predicted that eventually, digital money will be incorporated into the platform and made accessible to central banks outside of Singapore.
MAS has previously warned against the use of alternate cash. It discouraged trading in January and took steps to limit the promotion of digital payment tokens in certain public areas.
While the country’s Deputy Prime Minister is reported to have told conference attendees in May that retail investors should not buy cryptocurrency, last week he also declared that “the potential for FinTech remains tremendous.”