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Ep 65: Stablecoins, Trust, and Singapore’s Regulatory Playbook
48 Plays8 days ago
Adrian Ang (Partner at Allen & Gledhill) at brings a clear view of how Singapore approaches stablecoins, blockchain regulation, and the risks that come with digital money. He lays out the logic behind MAS’s framework, from technology-neutral regulation to the higher standards expected of serious market participants. Adrian also explains why regulatory clarity has become one of Singapore’s biggest strengths as a financial hub.
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Transcript
Introduction to The Policy Layer Podcast
00:00:06
Speaker
Welcome to the Policy Layer, where we talk about the real decisions shaping crypto, tech, and the future of trust. I am Silvia Sanchez, your host from the Avalanche Policy Coalition. We aim to bridge the gap between the builders of Web3 and the people that are shaping the rules. On our podcast, you'll hear from policymakers, developers, academics, and others working at the edge of tech and regulation.
00:00:32
Speaker
We ask the questions that everyone's actually wondering and we keep it easy to follow. This is the Policy Layer.
00:00:43
Speaker
Hi, everybody, and welcome to The Policy Layer, our podcast from the Avalanche Policy Coalition, where we talk with the people shaping the rules, ideas, and infrastructure behind blockchain and digital assets. I'm your host, Silvia Sanchez, and I'm really excited about today's conversation because we are continuing this ongoing thread that we've had on stablecoins, on these events we've had around the world, because I think that behind that one word, we have big questions about trust, regulation, payments, risk, and what kind of digital money policymakers want to allow into the system.
00:01:18
Speaker
And there's a very special place to have that conversation, which is Singapore, a jurisdiction that has built a reputation for being clear, thoughtful, and focused on getting the substance right.
Who is Adrian Ng?
00:01:29
Speaker
And joining me today is Adrian Ng, who has spent a great deal of time thinking about how stablecoins should be understood beyond the technological component of it, but also the legal and regulatory product that they are.
00:01:43
Speaker
Adrian is a partner in the financial services department and is co-head of both the firm's fintech practice and its ESG and public policy practice. He is consistently recognized for his expertise in financial ah regulatory work in Chambers Global, Chambers Asia Pacific and Legal 500 Asia Pacific and has been noted as a first-class lawyer.
00:02:05
Speaker
He is also, he is the only private practice lawyer in Singapore who has been named in the 2020 Global Banking Regulation Reviews 45 under 45, lists of top banking regulation specialists from around the world. So that's a really a big intro just to get into our conversation.
How does Singapore regulate stablecoins?
00:02:22
Speaker
our episode where we'll talk about how Singapore's monetary authority approach stable coins and also into the bigger question that sits underneath all this. What happens when we start thinking about blockchains as public infrastructure? So thank you, Adrian, for joining us. Thank you so much, Sylvia. It's a real pleasure to be invited on onto your podcast. Thank you. Amazing. So I think just to get started, and a lot of jurisdictions are still figuring out how to think about stablecoins. There are a lot of questions, a lot of things to still understand. So how did Singapore approach this conversation in the first place? And what problem and was Singapore's monetary authority really trying to solve? I think to answer this question, one has got to consider the question in in two different time periods. What the current situation is and how the issuance of stablecoins are regulated right now, and what's going to be going to happen in the near future.
00:03:26
Speaker
So, ah you know talking about the current situation, as things stand, cryptocurrencies and stablecoins are regulated in the same manner. When we talk about cryptocurrencies, I'm talking about things like Bitcoin, Ether, Ripple, Litecoin, and stablecoins, of course, i'm talking about USDC, USDT, right?
00:03:48
Speaker
So right as things stand in Singapore, there are essentially five crypto type activities that are regulated. Number one, running a crypto exchange. Number two, providing a crypto wallet.
00:04:01
Speaker
Number three, ah assisting with the transmission of cryptocurrency from one account to the next, ah number four crypto brokerage services, and number five ah dealing in cryptocurrencies, which is essentially buying and selling cryptocurrencies as principal as a service.
00:04:19
Speaker
So the current focus of regulations is really on anti-money laundering standards, it's on consumer protection, it's on technology risks.
What prompted the new stablecoin framework?
00:04:29
Speaker
so Why is there, I mentioned earlier that there is now a push to regulate stable the issuance of stablecoins, and this new framework will likely come out in the near future. And this is consistent with other major financial centers.
00:04:48
Speaker
You may ask, well, if things are regulated in a certain way right now, why do you need this new framework? And the answer actually ties in with your question, right? What problem was MAS really trying to solve? I think when when the initial framework was operationalized, there were certain risks that MAS was trying to to address. and I mentioned that technology risk, consumer risk and so on.
00:05:15
Speaker
But you you and I know that with fintech and cryptocurrencies and stablecoins, things move very quickly. right And so you had something like what happened with Terra Luna USD.
00:05:27
Speaker
If you recall, this these stablecoins, they're called stablecoins, but essentially they're not backed by any assets. And they are, I suppose, the the value of the stablecoin is maintained by controlling the amount of stablecoins in the market. right So if if things go one way, you either buy Terra Luna USD to reduce the number in the market or you you sell Terra Luna USD to increase the the number in the market. right and That's how you you create balance. All of this is done by algorithms and and and smart contracts.
00:06:05
Speaker
and What happened was the safeguards were not up to the task and essentially Terra Luna USD basically collapsed.
00:06:16
Speaker
Many people lost a lot of money And I think there was a lot of angst in the industry. So, you know arising from from this, I suppose, fiasco, I'm sure that one of the things that the MAS looked at was how do you actually make sure that stablecoins that are issued we may retain their stability?
00:06:40
Speaker
um And that is probably one of the key reasons why MAS decided to come up with a new framework, which will be effective probably sometime this year, if I'm guessing, in relation to the issuance of stablecoins. And I'm i'm also pretty sure that ah major jurisdictions around the world probably have similar
Algorithmic vs Asset-Backed Stablecoins
00:07:05
Speaker
considerations. so So this new framework that I'm talking about, it's meant to address
00:07:12
Speaker
the shortcomings of algorithmic stablecoins. Essentially, to ensure stability in stablecoins, stablecoins need to be asset-backed.
00:07:24
Speaker
I mean, they're called reserve assets. these ten These are prescribed in nature. They need to be liquid. You've got requirements like daily mark-to-market valuation. You've got base capital requirements imposed on the issuer to guard against insolvency.
00:07:39
Speaker
and you got a definitive right of redemption in terms of the to the stablecoin holders within a specified timeframe. In Singapore, it's meant to be T plus five. And ah this this new framework for the issuance of stablecoins is very similar to what you have in other jurisdictions. Like, for example, you've got the Genius Act in in the US, right? you've got Mika, the markets and crypto assets in Europe. You've got the stablecoin ordinance in Hong Kong. You've got the Financial Services and Markets Act in the UK. All of them, I think, are similar in nature in terms of the risks that ah they are trying to address.
00:08:17
Speaker
And they are similar in nature in terms of the prescriptions as well. Yeah, and I also think um it all comes down to the trust problem. Because when you have these algorithmic stablecoins, because even if they have the same term, this big umbrella term, just as we know that and Bitcoin is completely different from an NFT, that there are many types of crypto assets. The same thing with stablecoins. like They're not all issued the same way, but the headlines say, okay, stablecoins. And I think it's really easy to get caught in in the hype. But realizing that even within stable coins, they can have different provenance. and
00:08:57
Speaker
But as we saw with the collapse of of algorithmic stable coins, without full asset backing, well, then this stability is largely maintained by market sentiment. But that is not enough. So it kim it can come down to more like solving the value stability problem and run risk. um and just creating like this filter, this a filter for, okay, are you gonna be called a stable coin, but make sure that it's ah it's a good a product, what you're launching into the market. So with this in mind, and Singapore can sometimes be described as clear but cautious, and and I'd like to hear your thoughts on whether you agree with that type of description, but also how would you describe the philosophy of MAS when it comes to stablecoins and blockchain more broadly?
00:09:45
Speaker
Yes, I think it's ah it's ah it's a good question. um I would say that MAS is careful, not cautious, right? um And MAS has been consistent.
00:09:57
Speaker
I think consistency is extremely important. ah What have they been consistent about? I think one of the key ah things that that they have been consistent about is being technology agnostic.
00:10:10
Speaker
So in other words, it doesn't matter whether a particular product or service is wrapped up or is underpinned by blockchain technology. Blockchain blockchain technology technology in itself is not regulated. It really depends on how that technology is used.
00:10:28
Speaker
um So how would you what how would you apply this in practice? how would you ah i mean, it's it's one thing to say it's technology agnostic, but how do you then determine whether a particular product or service is regulated and how will it be regulated? What category will it fall under?
00:10:48
Speaker
I think a quick and easy test, which is something that one of the senior em MAS officers actually shared with me, is the MEOW test.
00:10:58
Speaker
So really this is not rocket science. What I was told was, look, if something is... I suppose bird-like in form, has feathers, swims in the water, lays eggs and quacks like a duck, then it's going to be considered a duck. right Similarly, if you've got a four-legged animal that's furry and I suppose likes milk and meows, then it's going to be considered a cat. so so It's a practical approach. One would look at the rights that are given to customers in terms of any product or service that's offered. And based on those rights, you would then try to categorize it in terms of the financial instrument that that um it could fall under, as well as the service or regulated activity that that you are undertaking. So I think the key point here is the technology doesn't matter.
00:11:58
Speaker
It is the the rights and obligations that that are granted to customers that really matter. right I know this sounds neat and simple approach, but the other thing i would say I would recognize is that it doesn't work in all cases. And that leads me to another point, but let me just give you an example of how this MEOW test might not actually work in
How does MAS approach regulation?
00:12:22
Speaker
practice. right Look at stablecoins itself.
00:12:27
Speaker
What exactly is a stablecoin? What's happening? what you're doing is you're setting aside a currency with a particular person. Essentially, you're obtaining an IOU and you get a contractual right to the to a return of the currency. right I mean, that's set in a very simple form.
00:12:45
Speaker
But if you take these characteristics and you think about a debenture or bond, or you think about a currency derivative, you know, one could say, actually, these financial instruments also have similar characteristics. right If you think about ah ah a bond, what's happening here? your You are a company, you want to raise money, you issue bonds.
00:13:07
Speaker
Yes, you're taking money from the bondholders, and this money is used for your ah for your business. right And you're giving an IOU in the form form of the bond. And the bondholder has a contractual right to the return of their principal at some point in the future. So it's similar.
00:13:25
Speaker
Like a currency option, which is a kind of currency derivative. Similar as well, right? Because as the stablecoin holder has the right to call on fiat currency that underpins the stablecoin in the future, basically they they it's like they're exercising an option to get the fiat currency back.
00:13:45
Speaker
So this could also be seen as a currency option, which which leads me to my next point, just tying this up with your question, which is,
00:13:56
Speaker
MAS is actually pretty forward looking and they provide clarity. So in situations where it is not so clear, for example, stablecoins, MAS actually does step forward to provide guidance as to the proper categorization of the instrument.
00:14:15
Speaker
So I think that's also quite, a in terms of their philosophy, that's also another hallmark, right? They they they don't like to um
00:14:27
Speaker
allow something to continue to be unclear. I think they they do proactively try to give regulatory guidance.
Singapore's Regulatory Standards as an Advantage
00:14:34
Speaker
um I think that the the last thing I would say is this.
00:14:40
Speaker
In terms of of, again, the regulatory philosophy, our fintech laws in Singapore are clear, but of a very high standard. And that's important to note because ah in general,
00:14:54
Speaker
the regulator in Singapore often measures its regulations against other leading financial centres. There are no reasons for this. For example, to guard against regulatory arbitrage to ensure that Singapore remains competitive, but at the same time, we attract the the right kind of fintech companies to Singapore.
00:15:14
Speaker
So, you know, I've heard complaints about Singapore's high standards when it comes to fintech regulations. um Well, that is certainly true in terms of of how difficult it is to comply with.
00:15:28
Speaker
But I would say that the advantage is once you are licensed in Singapore, in order to get that license, you would have had to incorporate policies and procedures that are world-class.
00:15:40
Speaker
And once you have did these world-class standards, it may be the case that it's easier to expand into various regions and various countries because you already have policies and procedures and systems that are of extremely high standards. So, you know, it's not a disadvantageous thing to to actually start with being licensed in Singapore first.
00:16:03
Speaker
That's an interesting point. And I think and just to like wrap up that part of and the philosophy that MAS had in approaching it, and I think it's just worth am highlighting this again, because I know this is a...
00:16:16
Speaker
special podcast on Singapore, but I'm sure that many other jurisdictions that are also figuring out how to navigate stable coins. It can be helpful also to show this tech neutral risk aware mentality. Like, as you said, like they don't really care whether you are using a blockchain or a spreadsheet as a transaction led ledger, provided that of course they are robust, safe, scalable systems. But that if you are issuing a product, if you're in this in this case stablecoins, they want to see that you are addressing the risks to the public. and
00:16:53
Speaker
And also, as you said, okay like making sure that there's regulatory clarity for the players, even though there is this relatively high barrier to entry, it already gives you a big advantage.
00:17:06
Speaker
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00:18:04
Speaker
So just building on that, why has regulatory clarity become such a competitive advantage for Singapore as a global financial hub? We hear, okay, there's the big players, especially in fintech, and people in Singapore. But I just wanted to dissect that point a little bit further.
00:18:22
Speaker
Certainly. I think i think ah you know regulatory clarity helps you in in in keeping you out of jail. ah you know Nobody wants to breach the law and get fines or go to jail.
00:18:35
Speaker
But on a more serious note, ah you know all businesses want to be able to budget properly and to deploy their assets efficiently. um you would want to know how much effort you would need to put in and how much will cost to operate in a particular country. right so if the you know if If there's no regulatory clarity and the interpretation of regulations keep changing, or if there are no regulations to begin with, how would you plan?
00:19:03
Speaker
Difficult. so you know i've found I've observed certain problems that some countries have encountered. I'll give you some examples. you know Some countries do not have specialized fintech regulations.
00:19:15
Speaker
So stablecoins and cryptocurrencies may come under commodities regulations. and And bearing in mind that these commodity regulations may have been drafted before the creation of the internet, and they do not lend themselves to cutting edge products. right And then lawyers in those countries struggle to fit the cutting edge products into regulations that were not meant to accommodate them.
00:19:37
Speaker
So that creates even more uncertainty. Another example, for certain countries, you have multiple um financial regulators um that look after different different parts of the financial industry.
00:19:52
Speaker
And when you have um a new product financial product, you could have a situation where it's not clear which financial regulator will will look after that new financial product. And it could be again the case that, let's say two or three financial regulators take regulatory ownership over the financial instrument and they issue different provisions that may not gel so well together.
00:20:19
Speaker
So I think the one one of one of the advantages of Singapore is that we are a small place, we only have one financial regulator, regulator the monetary authority of Singapore. So we we don't have these issues. right um But ah perhaps i I'll say one other thing in terms of regulatory clarity.
00:20:39
Speaker
ah it's I
00:20:45
Speaker
i think regulatory clarity is not just a competitive advantage, but what's also important is when is this regulatory clarity provided?
00:20:56
Speaker
Is it provided after there's some uncertainty and then you wait for some time and the issue gets worse? Or is it forward-looking? You provide this regulatory clarity upfront so that everyone knows how to deal with this instrument.
00:21:12
Speaker
So I think from what I've observed, Singapore tends to be quite forward-looking in handling cutting-edge instruments. and And they see this as as opportunities. um Once the the opportunities are identified, the regulatory framework is put in place pretty quickly to attract high quality players into the ecosystem here. So I'll give you one example right before I finish off.
Risks in Stablecoin Issuance vs Intermediation
00:21:36
Speaker
Gold trading, the gold trading ecosystem in Singapore. With all the uncertainties facing the world, there really has been a flight to safer products such as gold. And less than three weeks ago,
00:21:47
Speaker
the regulator in Singapore as well as the Singapore Bullion Market Association set up key focus areas to try and strengthen Singapore's position as a trusted gold trading center ah serving the Asia-Pacific region. So this is basically i mean bit something that's forward-looking.
00:22:06
Speaker
the The focus areas would be to develop gold-related capital market products. It would be to put in place um internationally aligned standards for vaulting and logistics.
00:22:20
Speaker
It would be to build a clearing system to support settlement for trading large bar and kilo bar gold. So, you know, I think that's very timely. In fact, in the last couple of weeks, I've seen many people interested in issuing stablecoins that are backed by gold.
00:22:38
Speaker
So I think this is a good example of how the regulator does actually follow the trends and thus look at things in a forward-looking way.
00:22:51
Speaker
and that's And that's a good approach. And I think that while other jurisdictions were debating or in fact are still debating if they should regulate, Singapore got a head start in defining, okay, how will we regulate this? And it's also noticeable. a Bybit's 2025 world crypto rankings listed Singapore as a top country for regulatory clarity. And more than, as you said, okay, like people like clarity to stay out of jail. It also gives you that that's safer...
00:23:22
Speaker
So just that safer sensation, which also is a huge thing when you're both as a developer but also as a consumer interacting with a product, purchasing something, or in this case, using a payment system. um And you mentioned, okay issuance and intermediation. And Singapore draws a very clear line between the two, ah between how you issue a stablecoin and then the intermediation process. So why was that distinction so important? Because I think that sometimes it could get mixed up. So I just want us to clarify that a bit more for for our audience. Of course.
00:23:58
Speaker
ah Well, I would say this. Issuance and intermediation in general present similar risks, but the the emphasis in terms of which risk would be more applicable is different. right so For issuance, for example, i mean this is basically issuing stablecoins.
00:24:15
Speaker
If you are an issuer, or rather if you are a customer, and you're looking at someone who's who's issuing stablecoins, what would you care about? You'd care about insolvency risk, for example. you You want to make sure that the issuer is well capitalized, and they are systems in place to kind of prevent their insolvency. right Because if they get insolvent, then potentially you lose your fiat currency. You would also care about things like redemption risks.
00:24:46
Speaker
um do they do they have enough Does the issuer have enough liquid assets in order to ah redeem your fiat currency when you want to trade in your stablecoin? So issuance, you would care about these things. Intermediation,
00:25:02
Speaker
is it's The focus is different in that you would care more on things like money laundering risk, technology risk, for example. Can people easily hack into a system to steal ah your your stablecoin or cryptocurrencies? You care about things like user protection risk. ah there Is there enough disclosure for you as a customer to understand the risks that that you face? so the The risks, thematically the risks may overlap.
00:25:32
Speaker
But the focus would be different depending on whether it's issuance or intermediation. And why is it important to to draw a clear line to answer your question? like I think drawing these distinctions allows you to better regulate the risks with more targeted regulations because you know you kind of focus on what's important and then hopefully when you establish regulations, these regulations are laser focused on on the the risks at hand.
00:26:01
Speaker
And I think also a we could illustrate it as the issuer is the factory and there are a whole set of standards and regulations thinking about like a supply chain of food.
00:26:14
Speaker
You as the issuer, in this case, like this food factory, you need certain safety standards, hygiene and standards so that the product is not going to poison the people that are going to buy it. um But then on the other hand, the intermediary is the supermarket. You are just distributing it, whether you are an exchange or a wallet. And they have their own set of different risks. There is custody, there's AML, but they are not...
00:26:43
Speaker
creating the product themselves. So even though they both are huge players in basically facilitating a stablecoins to the people, there is this this different line.
Singapore's Fintech Environment
00:26:56
Speaker
um And just if we have a builder or fintech team listening and thinking about operating in Singapore,
00:27:04
Speaker
what should they really understand early on about how Singaporean stablecoin regulation and just the gender this approach actually works in practice? ah Certainly. I mean, ah before I answer that question, I would say this, right?
00:27:21
Speaker
and and And perhaps it's a shameless plug for Singapore. I think Singapore is an ideal place to to set up a fintech business. ah The government is supportive of the fintech industry.
00:27:33
Speaker
We have strong industry associations such such as the Singapore FinTech Association that helps to act as a bridge between its s FinTech members and the regulator. There's a ready supply of skilled workers.
00:27:47
Speaker
ah many For example, many tertiary educat educational institutes have FinTech courses. ah financing is not a problem. Singapore is a financial major financial centre and you have all the the major international banks, very strong domestic banks, PE funds, venture capital people, family offices,
00:28:08
Speaker
all all in in one small space and everyone speaks English and we have nice food. So, you know if you are thinking about coming to Singapore, there are a lot of pluses. Now, to answer your question specifically, what should Builder or FinTech team understand about regulations and how they actually work in practice?
00:28:28
Speaker
I would say this, right? ah We've said a number of times during this conversation that Singapore's regulations are clear and of a very high standard. I think the key point I want to emphasize is that if you want to come to get to Singapore and you determine that you actually would need a license because you're undertaking a regulated pod product or you you should comply with all of the regulations.
00:28:56
Speaker
So, you know, I think a listener might think of, yeah, of course you have to comply with all the all the regulations. well What's the point of the regulations? I want to emphasize this.
00:29:07
Speaker
I mean, let's say you've got 100 regulations to comply with, you need to comply with those 100 regulations. It's not good enough to comply with 95 out of the 100 of these regulations. I think the the the process for applying for the license is actually very strict.
00:29:22
Speaker
And so, you know you you really have to go into the weeds when it comes to ensuring that you meet all the standards. Now, once you get that license, that's not the end of the story.
00:29:36
Speaker
you need to ensure that you comply with ongoing compliance obligations. And it's not just a question of of you doing it, there will be checks and balances as well. So for example, you need to engage an external auditor, which ah audits your adherence to these regulations on an annual basis.
00:29:54
Speaker
You also need to have an internal audit function to make sure that in interpret that checks that at least internally you comply with these obligations. And the regulator does conduct inspections on licensees every few years. So it's something that is taken very, very seriously.
00:30:12
Speaker
Now, I don't want to scare people away. So I've said that, oh, you know, it's strict and there are all these requirements. I think the the regulator is prepared to be flexible in certain situations.
00:30:26
Speaker
um if your product or service is innovative, it is possible for you to enter into a sandbox. So how does this sandbox work?
00:30:37
Speaker
Basically, one, as I said, your product or service has got to be innovative. If it's run of the mill, then you probably just need to apply for a normal license. So if it's innovative, you would then of did look at all the compliance obligations that you would otherwise need to adhere to and you would pick out those compliance obligations that you would have problem you you would have a problem adhering to.
00:31:05
Speaker
You would then apply to go into the light into the sandbox and you tell the regulator, hey, you know what, out of these 100 obligations, we can't comply with five of them. Can you please give us some dispensation?
00:31:17
Speaker
If you get into the sandbox, you will you will get that dispensation. You will be able to operate without having to comply with everything. Usually the sandbox period will last for about nine months.
00:31:29
Speaker
but But if you exit and you want to continue operating your business, you would need to get a full license and you need to comply with all the corresponding compliance obligations. So the sandbox is really there.
00:31:43
Speaker
you know, for you to be able to test out your product and see whether it has legs. Interesting.
Global Regulatory Comparisons
00:31:49
Speaker
And um when you look at other major jurisdictions, where do you see alignment with Singapore's approach? And where do you see meaningful differences? and I know that we can let this drag on for a long time, but just like at a glance, what are some key things to compare and contrast on the of different approaches? ah i think in in general, if you look at I think what underpins a lot of this is compliance with FEDF standards, the Financial Action Task Force, which is an international body that sets out anti-money laundering standards. So in general, if you look at ah major financial centers that do well in terms of FEDF audits, Singapore standards are pretty similar to their standards.
00:32:42
Speaker
And as I said earlier, you know when when the regulator looks at new regulations or tweaking existing regulations, they always look at all the other major financial centres to make sure that there's no regulatory arbitrage and we don't lose out and we don't make our standards too lax.
00:33:00
Speaker
So in general, I would say that you know ah these rules and regulations tend to be quite competitive and quite similar to to other um major financial centres. It is different if you're looking at... ah you know There are some countries where perhaps the AML standards are not so high,
00:33:20
Speaker
and maybe incentives are granted or for people to go and start businesses. I don't think Singapore sees itself as attracting the same kind of fintech companies as as those other countries.
00:33:35
Speaker
So that is is is not a a good comparison, I think. Okay, and just to conclude, because we're um almost out of time, and i think that you provided a really good overview, both of the philosophy and the reasoning behind MAS's approach to stablecoins, but also this is more of like a forward-looking question, and um looking five years out,
00:34:00
Speaker
What do you think stablecoin regulation in Singapore will
The Future of Stablecoins
00:34:05
Speaker
look like? Is there something that gives you a certain sense of optimism about where this is all heading?
00:34:11
Speaker
oh for sure. I mean, I think stablecoins and blockchain technology, that's that's really the way of the future. I think what's certain is in five much less than five years, the new stablecoin issuance framework will be out in Singapore.
00:34:27
Speaker
what I predict will happen is there will be a global rush to issue stablecoins because it's not just Singapore's framework that's coming out. The Genius Act in in the US, you've got the UK regulations, Hong Kong, Japan, it's all coming out around the same time. So many people are very excited about this. And then and I think you'll see many people rushing to issue stablecoins because they see it as an opportunity. Unfortunately, the market can't absorb like so many stablecoins.
00:34:57
Speaker
So probably you'll see you the stronger stablecoins winning out. So there will be some consolidation in terms of of what's in the market. Having said that, I think stablecoins have legs in the long run.
00:35:10
Speaker
ah In parallel stablecoins, you will see an increasing interest in tokenized capital market products. um placing these tokenized capital market products on the block blockchain and ah allowing settlement with stablecoins on the blockchain brings numerous advantages. So essentially you'll get all the benefits of the blockchain, things like atomic settlement and so on.
Conclusion and Key Takeaways
00:35:35
Speaker
I think right now, one of the key things that's holding back block stablecoin adoption, as well as adoption of tokenized capital market products, is mindset. this is I'm talking about Singapore. right Singapore has a growing population and many older folk just don't feel so comfortable undertaking online transactions, let alone with stablecoins.
00:35:58
Speaker
But I think as the younger generation comes of age, you'll see more people with financial means adopting stablecoin settlement. And these people grew up at a time when you know the internet was already there, and they are quite comfortable dealing with and online transactions.
00:36:17
Speaker
So I think when that happens, you will see a greater uptake in the usage of stablecoins as well as tokenized capital market products. I am too, honestly, and um it's a good way to to wrap up this amazing discussion. And I'm sure that we'll continue to see how else it will continue to develop and how Singapore will also be a big reference point. So, Adrienne, thank you again for joining us. I particularly liked how clearly...
00:36:48
Speaker
you helped us understand a bit more Singapore and stablecoins approach, calling things what they are, regulating them based on what they do, and also just trying to bring structure to a space that too often gets treated in extremes because this all comes down to trust, to clarity, which is what helps people build. It helps markets grow, evolve, and it also helps the public tell the difference between something solid and something sketchy. And I think it says a lot about how we should think about but blockchain policy more broadly, especially as the systems are becoming part of the rails behind digital finance. So thank you again, Adrian, for joining us, for sharing your perspective. And also thank you again to everybody for listening to our Policy Layer podcast. We'll catch you all next time.
00:37:37
Speaker
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