In 2024, Singapore plans to initiate a pilot program for the live issuance and use of wholesale central bank digital currencies (CBDCs), as announced by Ravi Menon, the Managing Director of the Monetary Authority of Singapore (MAS), at the Singapore FinTech Festival 2023.
Menon revealed that these efforts will expand upon previous experiments, though he did not provide specific details on the timeline. The MAS, Singapore‘s central bank and financial regulator, will pilot the live issuance of wholesale CBDCs to facilitate instant payments between commercial banks.
Wholesale CBDCs, distinct from retail CBDCs catering to individuals and businesses, are digital currencies used by central banks and financial institutions for high-value interbank transactions.
Menon discussed the future of the financial ecosystem, emphasizing the role of stablecoins and CBDCs rather than cryptocurrencies. He identified four digital money contenders: privately issued cryptocurrencies, CBDCs, tokenized bank liabilities, and regulated stablecoins. However, Menon critiqued cryptocurrencies, arguing they have failed as digital money due to their poor performance as a medium of exchange or store of value, their susceptibility to speculative fluctuations, and the significant losses suffered by many investors.