The Central Bank of Singapore will explore asset tokenization and DeFi together with JP Morgan, DBS Bank and Marketnode. The Monetary Authority of Singapore (MAS) reports in a statement that it will carry out these actions through the Guardian Project. DBS Bank, JP Morgan, and Marketnode will be in charge of the first pilot, which will examine possible DeFi Development Company uses in wholesale finance markets. In the pilot, bonds and tokenized deposits will be added to a regulated liquidity pool. The announcement is timed to coincide with remarks made by Jamie Dimon, CEO of JP Morgan, who emphasised that investors need to get ready for the upcoming hurricane. In particular, as a result of the strain brought on by the more restrained monetary policy in the United States and the conflict in Ukraine.

Singapore Bank, Defi and JP Morgan

According to MAS, tokenization is the process of using a smart contract on a blockchain to digitally represent assets or other objects of value. This enables the fractionalization and peer-to-peer trade of real economy and financial assets through the Internet.

When employed in the context of financial services, these smart contracts allow for decentralised financing (DeFi Token Development). In DeFi, financial transactions, such as loans and trading activities, can be carried out on a blockchain, without the need for intermediaries. It could increase financial services' effectiveness, accessibility, and affordability. This will "boost financial market liquidity and enhance economic inclusion," according to MAS.

With JP Morgan, the Singapore Central Bank will investigate asset tokenization and DeFi.

Japan and the Web3

Japan's Prime Minister Opens To Cryptocurrency Tax Reform To Boost Web3 Growth. As Tim Alper reports in Cryptonews, Fumio Kishida told Parliament that Web3 could boost economic growth, suggesting he may be ready to push for business-friendly legal reform. Earlier in May, Kishida also spoke to British investors about Web3, the Metaverse, blockchain, and NFTs.

Japan recognizes stablecoins as digital money. The Parliament of Japan has approved a bill that recognizes stablecoins as digital money. According to regulators, the law will apply to stablecoins pegged to the yen or another fiat currency. In addition, it will allow its holders and investors the possibility of exchanging them for their nominal value. The Japan Financial Services Agency will legalize stablecoins issued by authorized entities, such as licensed banks or duly registered finance companies. The new law will take effect in one year.

Organisations dedicated to creating and using Web3 apps.