especially for cross - border payments and settlements. cbdcs are the direct liability of, and payment instrument, of a central bank. this means that holders of cbdcs will have a direct claim on the central bank that has issued them, similar to how physical currency works today. wholesale cbdcs are restricted to use by financial institutions. they are akin to the balances which commercial banks place with a central bank today. wholesale cbdcs on a distributed ledger have the potential to achieve atomic settlement, or the exchange of two linked assets in real - time. they have the potential to radically transform cross - border payments, which today are slow, expensive, and opaque. mas does not see a compelling case for retail cbdcs in singapore. retail cbdcs are issued to the general public. they are like the cash we carry with us, except in digital form. the case for a retail cbdc in singapore is not compelling for now, given wellfunctioning payment systems and broad financial inclusion. retail electronic payment systems are fast, efficient, and at zero cost, while a residual amount of cash remains in circulation and is unlikely to disappear. nevertheless, mas is building the technology infrastructure that would permit issuance of retail cbdcs should conditions change. mas has been actively experimenting with digital currency connectivity since 2016. on the international front, mas is participating in project dunbar, which the bank for international settlements innovation hub is working on in its singapore centre. the project is exploring a common multi - cbdc platform to enable cheaper, faster and safer cross - border payments. domestically, mas is working with the industry on project orchid to develop the infrastructure and technical competencies necessary to issue a digital singapore dollar should there be a need to do so in future. anchor players with strong value propositions and risk management mas seeks to anchor in singapore crypto players who can value add to our digital asset ecosystem and have strong risk management capabilities. a vibrant digital asset ecosystem will encompass a wide range of value - adding activities. let me cite three examples. jp morgan has established its digital asset capabilities in singapore via its onyx division, which has pioneered several dlt - based products and initiatives. offerings include round - the - clock real - time fund transfers with shorter settlement times and no intermediaries. contour, a global trade finance network of banks, corporates and trade partners, has established its future of finance lab in singapore. it will conduct research to develop novel, digitally native trade

finance solutions. nansen is a singapore - based company that analyses more than 100 million blockchain wallet addresses across the world. it provides insights on blockchain network activities and visibility on transacting parties, thereby helping to improve transparency in the digital asset ecosystem globally. digital asset activities involving payment services must be licensed under the payment services act. we recognise there is some frustration about mas ’ licensing process. some industry players have described it as “ a slow and tedious ordeal ” ; others as a “ bugbear for the fast - moving space ”. given how new the digital asset industry is, it has not been easy for industry players or for mas. on mas ’ side, we closely scrutinise licence applicants ’ business models and technologies, so that we can better understand the risks. on the part of applicants, many are not familiar with managing the risks of facilitating illicit finance. mas engages the applicants closely to assess their understanding of our rules and their ability to meet our standards. this takes a considerable amount of time – but it is necessary. mas cannot compromise its due diligence process just to make it easy for digital asset players to get a licence. given the large number of applicants for licences, we have been prioritising those who demonstrate strong risk management capabilities and the ability to contribute to the growth of singapore ’ s fintech and digital asset ecosystem. singapore ’ s regulatory approach to manage digital asset risks like all innovations, digital asset activities pose risks as well as benefits. when digital asset activities took off more than five years ago, regulators around the world, including mas, assessed money laundering and terrorist financing risks as the key areas of concern. with the rapid growth in scale and complexity of digital asset activities, other risks have surfaced. regulators around the world including mas are therefore stepping up their responses to these new risks. there are five areas of risk in digital assets that mas ’ regulatory approach is focused on. first, combat money laundering and terrorist financing risks ; second, manage technology and cyber related risks ; third, safeguard against harm to retail investors ; fourth, uphold the promise of stability in stablecoins ; and fifth, mitigate potential financial stability risks combat money laundering and terrorist financing risks the key risk that mas regulation currently addresses is money laundering and terrorist financing. as users of cryptocurrencies operate through wallet addresses and pseudonyms, cryptocurrencies have made it easier to conduct illicit transactions. the online nature of transactions adds to the risk