Singapore Advances Digital Finance with CBDC Trials and Stablecoin Regulations

The Monetary Authority of Singapore (MAS) is accelerating its digital finance initiatives by launching trials for tokenized government bills backed by a wholesale central bank digital currency (CBDC). This move aims to enhance settlement efficiency in financial markets and integrate tokenized assets into mainstream banking systems. The pilot will test secure, interoperable tokenized assets within regulated frameworks, focusing on seamless settlement using digital money issued by the central bank.

As part of the BLOOM initiative, MAS confirmed that major banks—DBS, OCBC, and UOB—have completed the first live interbank lending transactions using a Singapore dollar wholesale CBDC, marking a significant step in Singapore's digital currency rollout. The trials will assess how tokenized bank liabilities and regulated stablecoins can coexist to meet diverse market needs, reducing friction in cross-platform transactions and supporting financial innovation.

Concurrently, MAS is finalizing draft legislation for a stablecoin regulatory regime, emphasizing sound reserve backing and redemption reliability to maintain public confidence and financial stability. MAS managing director Chia Der Jiun highlighted that unregulated stablecoins pose risks, stating, "Recurrent de-pegging can erode confidence, and trigger runs on other stablecoins." The framework aims to position Singapore as a global leader in digital finance regulation, with standards evolving as some stablecoins become systemic.

MAS is also expanding Project Guardian, a multi-year initiative exploring tokenization in foreign exchange and fixed income markets. This project seeks to achieve instant settlement, reduce intermediaries, and enhance transparency. A guide on tokenized capital markets products will be published, offering case studies and disclosure guidance. Chia emphasized the need for standardized token formats and interoperable networks, encouraging industry cooperation to build a unified marketplace and prevent global fragmentation.