How Singapore’s stablecoin rules could boost crypto’s ‘mainstream’ banking role

How Singapore’s stablecoin rules could boost crypto’s ‘mainstream’ banking role
  • Industry executives say the proposed rules by the Monetary Authority of Singapore are timely and will boost investor confidence
  • Recent moves by Hong Kong and Europe on rules governing stablecoins will also spur wider adoption of cryptocurrencies, according to the executives

 

The unpredictable price fluctuations of cryptocurrencies have been a make-or-break game for myriad investors across Asia for months.

However, only a handful of regional policymakers have ventured to integrate these volatile assets into the mainstream financial landscape.

Now, the latest move by Singapore’s central bank to introduce regulatory guidelines for stablecoins could prove to be a milestone for its rapid adoption in traditional channels like banks, analysts say.

Unlike other cryptocurrencies, stablecoins are viewed as safe haven assets as their values are pegged to traditional currencies or other assets such as government bonds and gold.

The Monetary Authority of Singapore building in Singapore. Photo: Bloomberg
The Monetary Authority of Singapore building in Singapore. Photo: Bloomberg

The Monetary Authority of Singapore’s (MAS) regulations announced last week will apply to nonbank users of single-currency stablecoins pegged to the Singapore dollar, or any currency from the world’s 10 biggest economies, and would require issuers to maintain low-risk reserves and return par value to investors within five days of receiving a redemption request.

“The MAS seems to be paving the way for greater trust and potential formal integration of stablecoins into the banking system.

However, as these regulations are scheduled to come into effect in 2024, their precise impact on bank transactions will [need to] be monitored closely,” said Chen Zhuling, founder and CEO of crypto finance gateway RockX.

The central bank would need to hold legislative consultations before Parliament passes amendments that would bring the framework into force. The coins will be labelled as MAS-regulated stablecoin.

The distinction of having central bank-regulated stablecoins, as opposed to non-regulated cryptocurrencies, is likely to ease concerns about their stability that have curtailed their usage for physical transactions, analysts say.

Stablecoins have been the backbone for cryptocurrency trading and can potentially slash transaction costs associated with traditional banking systems to a nominal amount, while speeding up processing times to seconds.

But stablecoins have in the past failed to make inroads into mainstream financial systems because of a lack of transparency about their reserves.

Popular cryptocurrencies like bitcoin and ether tend to suffer from high price volatility. Photo: Reuters
Popular cryptocurrencies like bitcoin and ether tend to suffer from high price volatility. Photo: Reuters

Anndy Lian, author of the book NFT: From Zero to Hero, said Singapore’s guidelines could bridge the gap between fiat currrencies and digital assets.

“But this should not necessarily mean that banks will start to accept all kinds of cryptocurrencies. The volatility of other cryptocurrencies is still a red flag for many,” he said.

Popular cryptocurrencies like bitcoin and ether tend to suffer from high price volatility, whereas stablecoins tend to hold steady since they are linked to fiat currencies and other such assets.

Despite their relative safety, clamours for regulation of stablecoins grew after two such sister currencies – Terra and Luna, whose values were algorithmically pegged to the US dollar and not backed by cash – suddenly collapsed in May last year.

Singapore’s strict guidelines are meant to reassure both investors and institutions that could open new avenues for the asset class, industry executives say.

“Banks may even issue stablecoins for tokenised bank deposits as part of their rapidly developing digital transformations,” said Gerald Goh, co-founder and CEO of Sygnum Singapore, a digital assets fintech group.

“This model – fully regulated, traditional-asset backed and pegged to a high-quality ‘stable’ fiat currency like the Singapore dollar – has the potential to become a blueprint for the industry,” he added.

Do Kwon, the cryptocurrency entrepreneur who created the failed Terra stablecoin, is taken to court in handcuffs in Montenegro in March. Photo: Reuters
Do Kwon, the cryptocurrency entrepreneur who created the failed Terra stablecoin, is taken to court in handcuffs in Montenegro in March. Photo: Reuters

First among digital equals

Singapore’s stablecoin framework will put it among the first jurisdictions to have rules to prevent mishaps.

Rival financial hub Hong Kong is, meanwhile, undergoing a public consultation on stablecoins and seeks to introduce regulation for them next year.

The European Commission set the ball rolling with the Markets in Crypto-Assets (MiCA) regulation, which it introduced with the purpose of establishing a global benchmark for governing cryptos.

After being proposed by the commission in September 2020, the European Parliament approved the MiCA regulation on April 20. It is due to come into force for stablecoins from June 2024, and for other assets from December.

Anne-Sophie Cissey, head of legal and compliance at crypto firm Flowdesk, said the European legislation has set the tone for markets. “With clarification on the legal status, all crypto actors will feel more at ease to deal with those.”

Singapore’s regulation could speed up stablecoins adoption across the region, industry executives say.

“Regulators now collaborate with international entities, for example, MiCA’s announcement in Europe led to similar guidelines in various countries,” said Danny Chong, co-founder of online asset tracker Tranchess.

“This trend suggests that financial hubs like Singapore and Hong Kong should move towards converging rules. This convergence might take a few years to materialise, rather than happening immediately,” he said.

Hong Kong’s regulations are likely to follow Singapore’s soon, as it has been earnestly trying to woo crypto investors. In June, it introduced retail trading and licensing guidelines for crypto.

Many investors have already begun to gravitate towards tokenised assets.

“We are increasingly seeing more stablecoin adoption in Asia,” said Henry Zhang, founder and CEO of DigiFT, a Singapore-based decentralised digital asset exchange, adding that they were looking forward to introducing MAS-regulated stablecoins.

Tokenised US short-term bills have exploded to US$600 million this year, said Timo Lehes, co-founder of Swarm, a regulated decentralised finance platform based out of Germany, citing data from Coindesk.

The digital assets have also started making inroads past intermediaries in traditional financial channels, he said.

“We are already seeing applications taking tokenised forms of cash and financial products that cut out the middleman. In this new world, financial institutions will need to rethink financial product design that puts consumers at the heart,” Lehes said.

Central banks have laid the groundwork for cyptocurrency adoption with countries like China, India and Australia either planning to or having launched a central bank digital currency that can compete with stablecoins, said an industry executive.

“This will drive the choice and innovation needed in the market that will lead to mass adoption,” said Vincent Chok, CEO of Hong Kong finance firm First Digital.

Source: https://www.scmp.com/week-asia/economics/article/3231578/how-singapores-stablecoin-rules-could-boost-cryptos-mainstream-banking-role

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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Panel Discussion on DAOs- Can DAO be the mainstream?

Panel Discussion on DAOs- Can DAO be the mainstream?

A decentralized autonomous organization (DAO) is a system developed to distribute decision-making, management, and entity ownership. It is an entity with no central leadership. Decisions get made from the bottom-up, governed by a community organized around a specific set of rules enforced on a blockchain. DAOs are internet-native organizations collectively owned and managed by their members.

Ideally, DAOs are being used for many purposes such as investment, charity, fundraising, borrowing, or buying NFTs, all without intermediaries. The panel discussion will share their point of view on DAOs.

1. 각자 DAO는 무엇인지 정의해 달라.
What is DAO. Each of you defines DAO.

2. 인간은 사회적 동물이다. 그리고 조직을 구성해 왔다. 그리고 그 조직은 언제나 리더가 이끌어왔다. 리더가 없는 조직, DAO 구현 가능할까.
Humans are social animals, and have formed organizations from the past. Any kinds of organizations always have a leader. Is it possible an organization without a leader (a.k.a DAO) in reality?

3. 다오의 의사결정과정은 다른 조직에 비해 상대적으로 비효율적이다. 그러한 비효율성에도 불구하고 다오가 주요한 조직의 형태가 될 수 있을까.
Decision making process of DAO is relatively inefficient than normal organizations. Can DAO be the mainstream forms of organizations, even if that kind of inefficiency?

4. 지금까지 유의미하게 성공한 다오가 있을까. 있다면 무엇이며, 없다면 그 이유는 뭘까.

5. 가장 극단적으로 중앙화된 조직의 형태 중 하나가 국가가 아닐까 한다. 그렇다면 국가와 다오는 공존할 수 있을까.
I think one of the extremely central organization forms is government. If so, can the government and DAOs coexist?

“Human are social animals ….. many DAOs effectively are centralized if you look at how they execute their decision process. Snapshot proposals are bullshit. A few calls and a few meetings outside the decentralized sphere changed the decisions. DAO can be very efficient, especially the single-purpose ones.

Yes, government and organizations can surely coexist vis DAOs. Look at Korea. The association/ lobby groups are a kind of DAO. Decisions are made by the community by votes. They lobby against the government for certain matters. Isn’t this the same as what we see in the crypto native space?” Anndy Lian, Book Author “NFT: From Zero to Hero” commented.

This event is held during the Korea Blockchain Week 2022. This sub-event brought many local Korean experts together.

When a DAO achieves success, it can then increase the value of the tokens. This helps tackle the issues related to generating capital. Anndy also mentioned that DAOs should find self-sustaining revenue and income.

Let’s DAO be a decentralized autonomous organization and not DOA (dead on arrival).

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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Anndy Lian tells Yahoo Finance “It is good to see another mainstream listed company [GAMESTOP] heading into the crypto space”

Anndy Lian tells Yahoo Finance “It is good to see another mainstream listed company [GAMESTOP] heading into the crypto space”

GameStop NFT Marketplace Rumors Swirl — What It Means for the Future of the Meme Stock

GameStop is going meta. The company, which reached a somewhat cult status among the Reddit army with its meme stock, has posted a slew of NFT-platform and Web3 gaming jobs on its career page this week, and rumors are flying as to what and when the company will launch.

The company also has a barebone website dedicated to an NFT platform, which says “We welcome exceptional engineers (solidity, react, python), designers, gamers, marketers, and community leaders. If you want to join our team, send your profile or something you’ve built to: nfteam@gamestop.com.”

“Just like we saw with Amazon hiring for crypto and blockchain specialists earlier this year, we’re seeing more and more companies looking to integrate crypto and blockchain into their roadmaps,” Stephen Stonberg, CEO of Bittrex Global, told GOBankingRates. “The future includes crypto as well as its underlying technology blockchain — which has proven to be a catalyst of innovation in so many sectors outside of its well-known home base. Blockchain is really the key to a metaverse-esque future for gaming, retail, the medical sector, and other industries. It’s exciting to see frontrunners in each market category push for the integration of blockchain within their respective sector.”

The job postings include three director of marketing- NFT platform positions; three senior software engineers- NFT platform positions; and two product owner- Head of Web3 gaming positions.

Tobias Batton, Founder and CEO at Ex Populus, an entertainment brand and publishing platform built entirely on Ethereum, told GOBankingRates that “GameStop holds a very special place in the heart of the game and investment community and it’s encouraging to see the company leverage its resources to create an innovative new platform that drives the industry forward.”

Batton added that it is inevitable that smart contracts will become ubiquitous and commonplace in the commerce of games and even within the games themselves. NFTs in video games are the likely species of blockchain technology to lead the way in the mass adoption of crypto and its various appendages.

“We are cheering for GameStop and are eager to meet them in the arena as a competitor,” Batton said.

Anndy Lian, Chairman, BigONE Exchange and founding member of NFT studio and marketplace INFLUXO, echoes the sentiment, telling GOBankingRates that “it is good to see another mainstream listed company heading into the crypto space.”

“Many of my friends think that this is a bullish sign for investors. I also see Redditors are claiming that they will buy more GME Shares when the marketplace happens. There will be an overflow to the crypto markets, too. From our exchange’s perspective, we have received more inquiries about listing of NFT Marketplaces in the last 24 hours, Lian added. “With the added publicity, I believe more companies will ride on the waves and take this as a chance. This would also mean that we will see more blockchain and crypto adoption through storefront locations, for example. Web 3.0 marketplace will be greater when more people are talking and using it.”

GameStop started getting in the news last January, when retail traders on the subreddit group WallStreetBets, who were intent on taking down hedge-fund short sellers by buying shares of stocks that didn’t seem to have much of a chance of success, sent stocks, including GameStop, soaring (and then crashing). This led to a slew of events, including a record 400% weekly gain for the week ending Jan. 29, which triggered intense regulatory scrutiny. Last week, the Securities and Exchange Commission (SEC) released its much-anticipated report on the GameStop frenzy, “the most famous meme stock, which raised questions about market structure and investor protections at the beginning of the year.”

 

Original Source: https://finance.yahoo.com/news/gamestop-nft-marketplace-rumors-swirl-201145555.html

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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