The Monetary Authority of Singapore (MAS) announced that the first industry pilot under Project Guardianwhich explores potential decentralized finance (DeFi) applications in wholesale funding markets, has completed its first live trades. More industry pilots have been launched to test the application of asset tokenisation and DeFi across a broader range of use cases in the financial sector. Under the first industry pilot, DBS Bank, JP Morgan and SBI Digital Asset Holdings conducted foreign exchange and government bond transactions against liquidity pools comprising of tokenised Singapore Government Securities Bonds, Japanese Government Bonds, Japanese Yen (JPY) and Singapore Dollar (SGD). A live cross-currency transactioninvolving tokenised JPY and SGD deposits was successfully conducted. In addition, a simulated exercise was performed involving the buying and selling of tokenised government bonds.
The first pilot, in which Standard Chartered Bank is involved, aims to digitise the trade distribution market by converting trade assets into transferable instruments.
The second pilot involves HSBC and UOB collaborating with Marketnode, a provider of digital markets infrastructure, to enable native digital issuance of wealth management products.
Sopnendu Mohanty, Chief FinTech Officer, MAS, said, “The live pilots led by industry participants demonstrate that with the appropriate guardrails in place, digital assets and decentralised finance have the potential to transform capital markets. This is a big step towards enabling more efficient and integrated global financial networks. Project Guardian has deepened MAS’ understanding of the digital asset ecosystem and has contributed to the development of Singapore’s digital asset strategy. We look forward to working with more institutions to advance global learning on policies, standards, and best practices for digital asset regulation and responsible innovation.”