Singapore has "tokenized" its currency through the Ethereum Blockchain!
It was only a few days ago that I wrote a post about Russia possibly launching its own national cryptocurrency.
In that post, I also briefly mentioned that the State Bank of Singapore was exploring the use of Blockchain technology - little did I know that they would announce these huge news only a few days later!
In a PDF document the Monetary Authority of Singapore (MAS) announced to digitize the national currency by a creating a token out of the Singapore dollar on Ethereum’s blockchain.
In November 2016, the MAS first announced "Project Ubin": the aim was to explore the use of blockchain and distributed ledger technologies and discover new solutions within the financial sector.
The first step of this project was to partner with R3, a distributed ledger start-up and consortium of financial institutions, to develop a proof-of-concept project to conduct payments between banks using blockchain technology.
That also includes creating a national digital currency, centralized by the State Bank MAS.
The Ethereum Blockchain was chosen for this particular project due to several benefits, amongst others the ability of including smart contracts.
This first step of the project has now successfully been completed.
Step 2 would be developing cross-border payment solutions.
Private Ethereum Blockchain
Project Ubin is making use of a private Ethereum Blockchain.
"A working interbank transfer prototype on a private Ethereum network…(and) successfully conducted end-to-end integration between the private Ethereum network and MEPS+."
MEPS+ is the electronic payment system operated by the central bank. It's a rail platform which enables domestic and international payments in Singapore.
The MAS was also testing Quorum, a private permissioned implementation of Ethereum developed by JP Morgan. With this technology, the focus lies on data privacy.
Quorum uses a voting-based model instead of the proof-of-work consesus model, and the throughput was higher compared to the Ethereum base protocol.
But the fact that the MAS decided to use Ethereum instead of other blockchain technologies suggest a public blockchain would be an option for future projects as well - increasing security and interoperability.
Benefits
Real-world applications of Blockchain technology have been booming in the past couple of years. But what would the specific benefits in this case be? What is the goal that Singapore wants to achieve by issuing their own national token?
Read this excerpt from the MAS' PDF document:
“MAS can create “atomic” transactions for the first time for cross-border fixed income products with payments directly on central bank money. This would enable true Delivery vs Paymen (DvP) where security and corresponding payment switches ownership simultaneously at the deepest technical level.This could remove the occurrence of late payments and payment failures. Certainty around delivery and near real-time, same-day (t+0) delivery also becomes viable. These could make both domestic as well as cross-border transactions more attractive from both a technology and end user experience standpoint.
Furthermore, the reduction in counterparty risk may drive a reduction in collateral requirements in some circumstances.”
What's next ?
This is probably the question we all want the answer to.
For the singaporean national token, the next steps are to explore cross-border payments and find solutions to legal problems like taxation etc.
But what's next in digital currency?
Russia has announced that they will create their own national token, China, the UK and Canada are planning to participate in similar projects. Blockchain technology is becoming more and more popular, even outside of the financial sector.
Will the future consist of countless centralized, national cryptocurrencies?
And what will happen with "traditional" cryptocurrencies like BTC and ETH then?
What do you think?
Images: 1, 2, 3, 4, 5, Sources: 1, 2, 3, 4, 5, 6
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© Sirwinchester
Geez... things are happening so quickly, it's getting hard to keep up. This is amazing news. I hope private blockchain tools can keep up with governments and ensure those who want to remain private can do so.
Your reply mentioned everything I would reply on this post ;-)
Amazing indeed. Crypto is not just hype anymore. The adoption is really taking place. Day by day its a snowball of more volume and transactions. Governments like Japan are treating Crypto like a currency (legalizing it)
I need to tell my friend this, his name is Ho Lee [insert your own expletive]
Never in my wildest dreams was it Singapore and in that dream it was Bitcoin, but Ether makes more sense.
You got any fiat I can hold for a few days?
Luke do you know this is real?
Good point, that will be an important factor.
And yes, 2017 has been packed with exciting crypto-news, everything is moving forward quickly!
I think centralizing and nationalizing cryptocurrencies won't be good for the entire crypto system since the entire base of cryptocurrencies is its de-centralized way of operations. It will also restrict the growth of emerging markets since they don't have the firepower to deal with the already developed economies. As a result it will only increase the divide and hinder the overall growth of the system.
Good points.
Its definitely true that a national token defeats the purpose of a decentralized cryptocurrency. It's just a way for the government to control it.
But still, it's great to see that they are finally realizing the potential of crypto and blockchain.
Absolutely...also I hope not but what if government and banks gang up and try to play the legality card on crytpocurrencies...but I'm sure our generation will come out strong and find out better ways to counter anti crytpo moves.
honest answer?
i' m scared of news like this
banks messed up the whole economy just for their own good
and now everybody is cheering that those fuckers come in?
wait a moment....
they are not intressted in decentralising anything or let you pay less fees ^^
why they should?
they are just looking for a place where they can go on with their filthy business
you need to understand that the stockmarket is limited to big investors
but in the blockchain they can move all the money they want to influence trends in their opinion
and did u mind that they will come after YOU for tax and other shit to just collect more money to use it against you?
NONONONO
i dont like banks comin in
they win, we loose...
I agree. But I think the fact that they want to start their own private blockchain shows that they realize they can't shut down the decentralized ones. So they'll try to spread propaganda to get people to use their private cryptocurrency. And that's where blockchain based social media (Steemit) comes in, with millions of users posting the truth about our options with cryptocurrency. When you try to control the internet, YOU LOSE.
The real value of all money is in the people.
And NOW, for the first time ever in History, WE can decide, how to use our money and with who we share it.
The problem with that is:
We do not have enough marketplaces, to be completely independent.
By knowing that Banks rush in and create a exchange currency to all Altcoins....
With their rules applied on it... so its still called crypto currency, but i will have all fuckups included like in FIAT money.
Its the same crap... they just saving printing costs now ^^
Believe me they will find a way to pervert the blockchain as well.
Good point. But once paper fiat is gone, and people are used to using crypto, why would they need to exchange for electronic fiat (nationalized cryptocurrency)?
where do you buy your food and what currency your vendor is accepting?
or your electric bill?
Actually, here in Japan they just started accepting Bitcoin for utility bills. And soon they'll be accepting it at thousands of stores across the country.
Of course, right now I use Japanese yen for daily purchases. I use Bitcoin to load up my debit card for online purchases, and also use Bitcoin directly where it's accepted, which is more and more places.
that is
AWESOOOOOME, did not expect ^^
just checked out your posts... so you resteem a lot hm?
you are living in japan, right?
there are so many thing people are interested in... why not write about it?
will follow to see with what u might come up and i hope u will ;-)
You definitely have a point. Having a state bank issue a national token defeats the purpose of a decentralized cryptocurrency.
But at the same time, at least the government is accepting crypto and its potential. If they can't regulate BTC or ETH, they want to make their own token with their own rules, exactly the same principle as in russia.
It was inevitable, that national blockchains would be created as an attempt to compete with the decentralized coins. I believe that the free market will chose decentralized block chains as future global borderless currencies.
Agree. The whole point of blockchain is decentralized ledger. A country's own blockchain is nothing more than a fancy data base. Public blockchains will be the standard in future with fiat tokens running on top like ERC-20 token. The chain itself will remain decentralized.
It will be very interesting to see how this unfolds.
Yes, a national token isn't decentralized anymore, so that kind of defeats the purpose of a regular cryptocurrency. It's just easier for the state bank to regulate it this way, and to create their own rules around it.
Thank you for sharing this information.
You're welcome, glad I could present some news!
From a personal POV what happens to prices when every country has their own blockchain is going to be so huge. From a broader POV, this is all sweet no matter what.
Yes, that's true.
I have no idea how the prices would develop, that will be very interesting to watch
Cryptocurrencies are the future ...moving with the speed of light..we are in a good place with steem as we will rule social media with this platform
Yes exactly, steem prices are rising and that's not a coincidence. Cryptocurrencies are finally getting more and more accepted.
Point, cryptocurrencies including steem will be the next best thing that happened to all of us..great
On the surface it looks like good news because a country is trying to adapt it but when you look at the fine details, its basically a government attempt to gain control. How does one centralized a blockchain and give your bank of interest rights to issue tokens. Something not adding up
Yes that's true, I mentioned that in another comment as well - a national token defeats the purpose of a decentralized cryptocurrency. Definitely.
It's just another way for the government to get involved with crypto, while still trying to keep control over it.
I'll be interested to see how these "national cryptocurrency" projects will turn out in the future.
Future is here! Thanks for this post. :)
Yes it is!
Thank you, glad you enjoyed it!
This is epic...
No, this redefines the word epic.
Epic is this on an epic day!
Can SOMEONE please explain how this would help the ETHEREUM TOKENS if at all? Like I understand the blockchain and that they have a "personalized" one (the bank itself), but what happens to the actual Ethereum coins out there?
I have been wondering this for a LONG time.
As far as I know, national tokens like these wouldn't have a direct influence on the Ether cryptocurrency.
The Singapore state bank is simply using the Ethereum Blockchain, but they are a completely independent token from Ethereum itself.
Of course there might still be an indirect influence, for example ethereum prices might rise in Singapore because the currency got more media coverage, but there is no DIRECT link.
thanks for the reply sir. So what benefit is there for purchasing Ethereum tokens?! I understand Steem no problem. The currency is the reward for posting and people benefiting one way or another. Bitcoin is obvious (for actual merchandis or service). So what does Ethereum actually offer besides the tech behind it.
Ethereum is similar to bitcoin in this case. You can use it as a regular currency if you want to buy something online, just like BTC.
And of course you can trade it.
But for Ethereum the added benefit is simply the tech behind it, the smart contracts offer so many benefits that many governments, big stores like walmart, and even the UN are exploring the applications of the ethereum blockchain.
I'm still not clear which Blockchain is being used. Is it Ripple from R3, or Ether Classic (ETC), Ether forked (ETH) both from Ethereum. I would like some clarification. Great Post, Thanks.
I believe it's ETH, ethereum classic wasn't mentioned at all.
You're welcome, glad you enjoyed the post!
Here in Canada, many of the banks have been hiring blockchain "experts" for a couple of years. Reading the pre-requisites, many want cryptocurrency experience.
I wonder how many banks are already quietly purchasing/investing in cryptocurrencies.
Nice post. Based in Singapore and this hasn't made much news here.
Very interesting that you say that, I'm surprised.
But I'm guessing once the token is completed, there will be major announcements in the news.
WOW...this thing go very BIG
Adoption was slow and then it was fast. Blockchain will rule the world.
This is so cool. things are moving fast( of course for good.)
The more country adapt the blockchain tech, the better the world will be in future.
This is a really interesting new trend with premissioned chains being used by governments to issue "fiat tokens." Thanks for sharing.
Also, if you are interested in Ethereum, you might like my recent post analyzing it. Would love to hear your thoughts.
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Holy shit. This is crazy!
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Thanks for the Heads Up!
You have a NEW FAN!
Keep STEEM N ON,
Frank
Oh boy, Bitcoin better be prepared, the technology behind Ethereum is just brilliant.
Excellent way to explain what is happening on this crypto-world.