SFF 2023 Unplugged

SFF 2023 Unplugged

80RR SG FinTech Hub
November 16, 2023

I moderated a panel at the Singapore FinTech Festival Unplugged Panel #3 – Insights from Singapore’s Digital Asset Ecosystem Development. The panel featured insightful contributions from industry experts Rajesh Sreenivasan from Rajah & Tann AsiaAaron Gwak from Libeara, and Chris Ngoi, CFA, CA from KPMG Singapore moderated astutely by Prof. Jungpil Hahn, Director of NUS FinTech Lab. A big shout-out to all the speakers!

Key Takeaways from this panel discussion:
1. Digital Asset Regulation: Regulating blockchain and digital assets presents unique challenges. The industry seeks clear regulations, while regulators look for practical examples, particularly in areas like real estate tokenization. This involves decisions on how and what to regulate, the structure and purpose of tokens, and choosing distribution models (retail vs. B2B, CeFi vs. DeFi). Regulators’ ‘slow, slow, sudden’ strategy is a thoughtful approach, carefully balancing the advancement of innovation with the necessity for robust regulatory frameworks and safeguarding consumer interests and financial stability.

2. Blockchain in Business and Trust: Singapore leads in using blockchain beyond transactions, integrating it into business processes and trust-building. An example is Singapore Airlines‘ KrisPlus program, which leverages blockchain for asset management and customer service, including identity management and data sharing, with AI enhancement. However, challenges like interoperability, varying investor disclosures, and international regulatory complexities remain, requiring significant coordination.

3. Emerging Trends and Challenges: The tokenization of e-bills of lading, a movement championed by countries like the UK and Singapore, was discussed as part of the core development. This highlights the broader issues at play in the digital asset ecosystem. The panelists talked about the incentives for regulators to create specialized frameworks, such as the Markets in Crypto Assets (MiCA) and digital security sandboxes, aimed at maintaining stability while being cautious of unforeseen consequences. The consultative approach taken by regulators, coupled with the focus on smart contract auditing, was noted as significant in addressing the complexities surrounding Decentralized Autonomous Organizations (DAOs). DAOs challenge traditional regulatory frameworks due to their decentralized and often borderless nature, raising questions about their economic and legal substance.

Singapore, a leader in digital asset ecosystem development, shapes its direction, necessitating collaborative efforts across academia, industry, and regulators for mutual benefits and sustained innovation.