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- PBM aims to allow crypto senders to set parameters for digital currency transactions.
- Amazon, DBS, and Grab are among the fintech firms experimenting with PBM.
The Monetary Authority of Singapore (MAS) has introduced a universal protocol designed to define the parameters for utilizing various cryptocurrencies.
The Monetary Authority of Singapore (MAS) published a white paper on its new Purpose Bound Money (PBM) initiative on June 21. The document outlines the concept’s duration and identifies the financial institutions and fintech companies participating in the pilot program.
Enhancing the Role of Digital Currencies
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PBM aims to enable digital currency senders to define criteria for transactions, including validity periods and types of merchants, applicable to digital currencies across various platforms, such as central bank digital currencies (CBDCs) or stablecoins.
This initiative has bolstered the role of digital currencies in the future financial landscape, as stated by Sopnendu Mohanty, the chief fintech officer of MAS.
The development of the paper incorporated feedback from the World Bank, the European Central Bank, the Bank of Italy, the Bank of Korea, and other entities within the financial sector. Amazon, DBS, and Grab are among the fintech companies trialing PBM.
For online transactions, Amazon will specifically evaluate escrow-like arrangements. Payment to the retailer will only occur once the buyer has received the products. The white paper also recommends that governments, banks, and fintech companies explore the practical uses of digital currency in greater depth.
This initiative aligns with Singapore’s ongoing support for the cryptocurrency sector. Circle, the issuer of the USDC stablecoin, received a license on June 7 alongside other prominent financial institutions. The crypto exchange Crypto.com was granted its own MAS license just days earlier.
