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The blockchain is often touted as one of the most revolutionary staples of modern technology. Institutions from banks to governments have attempted to “exploit” its technology in the hopes that they can digitize and record their data in real-time to keep it safe from security breaches and related issues.
The next spot on the map looking to harness blockchain technology is Singapore. Asia is proving to be a regular haven for digital currency and its respective technology. China is often regarded as the biggest influencer of bitcoin, touted for its price hikes, then pointed at and ridiculed when the price goes down. Yet activity in Asia continues to grow on a regular basis, and Singapore is looking to add itself to the mix.
The Monetary Authority of Singapore (MAS), the Singapore Exchange and eight major banks located in the region have joined hands to create a proof-of-concept project that will use the blockchain to heighten inter-bank and cross-border payments in foreign currencies. The purpose is to quicken payment processes and cut fees associated with financial transfers.
Managing director of MAS Ravi Menon explains:
“Under the pilot system, banks will deposit cash as collateral with the MAS in exchange for MAS-issued digital currency. The banks can later redeem the digital currency for cash. Banks also have the option of using the existing payments gateway to transact on the blockchain. This is an improvement over current large-value payment systems that are centrally operated. It strengthens resilience and lowers cost.”
The project was introduced during Singapore’s Fintech Festival, and has garnered support from tech innovators such as the R3 blockchain research lab and BCS Information Systems. Menon added to his words by saying that cybersecurity was as integral to the project as financial savings:
“A smart financial center must be a safe financial center. As more financial services are delivered over the Internet, there will be growing security and privacy concerns from cyber threats. Users will have confidence in new technologies and innovative services only to the extent they have confidence in cybersecurity.”
