MAS formulates three-year transformation plan for financial services: exploring token based real economy

On September 15, 2022, Huang Xunchai, Deputy Prime Minister and Minister of Finance of Singapore and Vice Chairman of the Monetary Authority of Singapore (MAS), released the Financial Services Industry Transformation Roadmap (ITM) 2025. ITM 2025 proposes a growth strategy to further develop Singapore as a leading international financial center in Asia, so as to connect the global market, support Asian development and serve Singapore's economy.

ITM includes five main strategies: enhancing asset class advantages; Digital financial infrastructure; Promote the net zero carbon transformation in Asia; Shaping the future of financial networks; Cultivate a skilled and adaptable workforce. MAS estimates that the financial industry will grow at an average annual rate of 4% to 5% from 2021 to 2025, creating an average of 3000 to 4000 net jobs each year. MAS will work with the financial industry to deepen Singapore's ability to play a key regional or global role in asset classes.

It is reported that the financial sector development fund under MAS will allocate about 400 million dollars to support the ITM 2025 plan. The program will help build capacity in key growth areas and provide training support for Singaporean financial professionals at different stages of their careers.

It is worth noting that MAS will take positive measures to shape the future of the financial network. Huang Xunchai, vice chairman of MAS, pointed out in his speech that it is too early to say what the future financial pattern will be like in 10 years. However, innovations such as tokenization and distributed ledger technology have great potential to reduce dependence on central parties or intermediaries. Therefore, more flexible cross-border digital financial networks and decentralized liquidity pools are likely to be involved in the future, so as to achieve cheaper, faster and more secure payments and transactions& nbsp;

In the short term, MAS has been seeking a new cross-border payment connection model, which will better connect our enterprises and personnel with the major regional and international markets. MAS will also consider developing a proof of concept for multilateral real-time cross-border payment links with ASEAN. At the same time, it also participated in a series of innovations that may achieve results in the long term.

In addition, MAS is exploring the potential of DLT in promising use cases, especially in cross-border payment and settlement, trade financing, and capital market activities before and after transactions. MAS is cooperating with the industry to explore the potential of token real economy and financial assets& nbsp; MAS is also seeking digital currency connectivity and has launched a project to use wholesale central bank digital currency (CBDC) for cross-border payment and settlement& nbsp;& nbsp;

At the same time, MAS will improve its regulatory approach to prevent possible new risks in digital asset activities. These include money laundering risks, technology and network related risks, protection of retail investors from harm, commitment to maintaining stable currency stability and mitigation of potential financial stability risks& nbsp;& nbsp;

In short, MAS aims to develop Singapore into an innovative and responsible digital asset activity center to improve efficiency and create economic value. This will be achieved through the development strategy and regulatory approach, which takes a holistic and collaborative view on the development of digital asset ecosystems.

Finally, Huang Xunchai, vice chairman of the Monetary Authority of Singapore (MAS), pointed out that the updated ITM is an ambitious plan, but it is not easy to deliver. Although our financial sector has performed well, the external environment has become more complex and challenging, and the road ahead is uneven, full of risks and opportunities. But we can draw confidence from what we have achieved together so far. Even in a complex and ever-changing world, Singapore can still be a fortress of stability, opportunities and innovation.