Last week, The Monetary Authority of Singapore (MAS) and Singapore Exchange (SGX) announced that they will be collaborating to develop Delivery versus Payment (DvP) capabilities for settlement of tokenised assets across different blockchain platforms. DvP is a settlement procedure which ensures that securities are delivered only if the requisite payment is made.
The MAS and SGX said in a joint statement that the goal of the project is to enable financial institutions and corporate investors to carry out simultaneous exchange and final settlement of tokenised digital currencies and securities assets, improving operational efficiency and reducing settlement risks.
The are three appointed technology partners for this project and they are Anquan, Deloitte and Nasdaq. By leveraging on the open-source software developed and made publicly available on Project Ubin Phase 2, the project will produce a report which will examine the potential of automating DvP settles processes with Smart contracts and identify key design considerations to ensure resilient operations and enhanced protection for investors. It is said that the report is set to be released by November 2018.
Chief FinTech Officer of MAS, Sopnendu Mohanty said: “technology is radically transforming how financial transactions are performed today, and the ability to transact seamlessly across blockchains will open up a world of new business opportunities.”
He also stated that “The involvement of three prominent technology partners highlights the commercial interest in making this a reality. We expect to see further growth in this space as FinTechs leverage on the strong pool of talent and expertise in Singapore to develop innovative blockchain applications and benefit from the new opportunities created.”
The project chair Tinku Gupta who is also the head of Technology at SGX said “This initiative will deploy blockchain technology to efficiently link up funds transfer and securities transfer, eliminating both buyers’ and sellers’ risk in the DvP process. This is a collaborative innovation bringing together multiple players to pursue real-world opportunities that will benefit the ecosystem.”
Source: Monetary Authority of Singapore
Image Credit: Monetary Authority of Singapore