Blockchain technology has ushered the world into the era of Central Bank Digital Currencies, and multiple nations are now either researching or testing their digital currency projects. However, not every nation wants a CBDC and is focusing on building a payments platform. Similarly, Singapore has developed a blockchain-powered payment system for international settlements dubbed Project Ubin.
According to a joint report by the Monetary Authority of Singapore (MAS) along with state investor Temasek, the nation has now completed the fifth and final phase of the project that has been going on for years. Per the report, the next phase for the project is its commercial rollout.
The prototype has been developed by the MAS in collaboration with JP Morgan and Temasek and is designed to enable faster and cheaper cross-border remittance compared to the traditional system. The report defines Ubin as:
“An international settlement network, modelled after this payments network prototype, could enable faster and cheaper transactions than conventional cross-border payments channels.”
Ready for launch
During the 5th phase of the project, the prototype successfully completed payment settlements in different currencies on the same network. The use of smart contracts was also validated for various use cases like Delivery-versus-Payment (DvP) settlement with assets on private exchanges, among others.
Chief FinTech Officer of MAS, Mr. Sopnendu Mohanty, commented on the development:
“Project Ubin has worked with the financial industry and blockchain community on a journey of experimentation, prototyping and learning. This has built a strong foundation of knowledge, expertise and experience, and paved a path towards commercial adoption. Following the successful experimentation over five phases, we look forward to greater adoption and live deployment of blockchain technology.”
The report further notes the various commercial use cases for the network type, and these include cross-border payments in multiple currencies, foreign currency exchange, and settlement of foreign currency-denominated securities.
Furthermore, the network can also be integrated with 3rd party blockchain platforms, enabling end-to-end digitalization across many industries and use cases.
“Blockchain technology has great potential in transforming businesses and opening up new business opportunities. Phase 5 of Project Ubin has demonstrated the commercial applicability, viability and benefits of blockchain technology across industries, beyond capital markets and trade finance,” added Mr. Chia Song Hwee, Deputy Chief Executive Officer, Temasek.
As of now, MAS and Temasek noted that some of the technical specifications for project Ubin will be made public. The authorities believe this would spur industry development.
As previously reported by The Daily Chain, Cambodia is working on a similar blockchain-powered payments system rather than a CBDC. It’s “quasi-form’ platform for everyday payments dubbed ‘Project Bakong’, is expected to support the government’s push to introduce QR-based transactions throughout the country.
The central bank believes that Bakong will help turn the tides in favor of the local currency by inducing Cambodians to pay using QR via a mobile application. The transactions are powered by a Hyperledger Iroha blockchain that facilitates real-time fund transfers between e-wallets integrated directly with the user’s bank accounts.