The Monetary Authority of Singapore (MAS) has unveiled its white paper on Purpose Bound Money (PBM) which is a concept for directing money towards specific goals and it is set to conduct pilot trials in partnership with industry giants like Grab and Amazon .
Introducing Purpose Bound Money (PBM)
PBM stands for Purpose Bound Money and it is a technology introduced by MAS to allocate funds toward specific objectives without the need for programming the money itself . It utilizes a standardized format that works across different ledger technologies including blockchains and supports various forms of digital currency .
Enhancing Transaction Conditions and Security
The PBM protocol allows payment senders to specify transaction conditions such as a validity period and store types . For retail sales payment is only released to the seller once the buyer receives the purchased items which guarantees the security and satisfaction of both parties involved .
Collaboration with Industry Leaders
Singapore is taking a proactive approach to PBM adoption by partnering with major market players like Grab and Amazon . Amazon will specifically test escrow agreements for online retail payments where the platform will receive payment only when customers have received their purchased items .
PBM and the Interest in Central Bank Digital Currencies (CBDC)
The PBM project was developed in collaboration with the International Monetary Fund, the Bank of Italy and the Bank of Korea . It give a demonstration to institutional interest in blockchain technology and central bank digital currencies (CBDCs) . This initiative aligns with Singapore’s Orchid project which is aimed at exploring the application of Distributed Ledger Technology (DLT) in the financial industry .
Singapore’s Commitment to Blockchain and Crypto
Singapore has emerged as a leading hub for blockchain technology with its ongoing efforts and growing interest in the field . The recent granting of a license to Crypto .com for tokenized digital payment services highlights MAS’s dedication to embracing blockchain and cryptocurrency . The development of PBM and the collaborative trials with industry giants further solidify Singapore’s position as a pioneer in the blockchain and crypto space .
As the city-state continues to make significant advances it displays its commitment to fostering innovation, enhancing financial services and leveraging the potential of blockchain technology for the benefit of businesses and consumers alike .
