Unifying Digital Money: MAS Proposes Common Protocol for CBDCs, Tokenized Bank Deposits, and Stablecoins

The Monetary Authority of Singapore (MAS) recently published a whitepaper proposing a common protocol for the use of digital money. The whitepaper, developed in collaboration with the International Monetary Fund, Banca d’Italia, Bank of Korea, financial institutions, and FinTech firms, aims to specify conditions for the use of digital money, such as central bank digital currencies (CBDCs), tokenized bank deposits, and stablecoins, on a distributed ledger.

Protocol Background

The Protocol for a Common API-based Design for Digital Payment Tokens (PBM) is designed to work with different ledger technologies and forms of money. It provides a common interface for the exchange of information between digital money wallets, enabling interoperability across different platforms. The protocol is intended to facilitate more efficient and secure transactions with digital money while promoting innovation and competition in the payments industry.

The PBM whitepaper proposes a modular architecture that allows for customization to meet the specific needs of different use cases and regulatory requirements. The protocol includes modules for user authentication, payment initiation, transaction verification, and settlement. Each module can be used independently or in combination with others, allowing for flexibility and scalability.

Trials and testing

Financial institutions and FinTech firms are launching trials to test the usage of PBM under different scenarios. The trials aim to validate the protocol’s functionality, security, and scalability in real-world situations. The testing will also help identify potential issues and inform further improvements to the protocol. The trials will involve the use of different forms of digital money, including CBDCs, stablecoins, and tokenized bank deposits. The trials will simulate different scenarios, such as cross-border payments, micropayments, and peer-to-peer transactions. The results of the trials will be used to refine the protocol and inform regulatory decisions.

Project Orchid

The PBM whitepaper builds on MAS’s Project Orchid, which explores the use of distributed ledger technology (DLT) for cross-border payments. Project Orchid aims to improve the efficiency, speed, and cost-effectiveness of cross-border payments by leveraging DLT. The project has achieved several milestones, including the development of prototypes for a cross-border payments network and a digital currency exchange. The PBM whitepaper extends the work of Project Orchid by proposing a common protocol for digital money that can be used across different use cases and regulatory regimes. The whitepaper aims to encourage greater research among central banks, FIs, and FinTechs to understand the design considerations in the use of digital money.

PBM source codes and software prototypes

To support ongoing development and learning, PBM source codes and software prototypes developed under Project Orchid were released today for public access. The open-source codes and prototypes demonstrate how PBM can be used to embed digital money in escrow arrangements. This serves as a reference model to foster interoperability across different platforms. The release of PBM source codes and software prototypes is a significant milestone in the development of digital money. It allows developers to experiment with PBM and contribute to its further development. By releasing the code as open source, MAS is promoting collaboration and innovation in the payments industry.

Mr. Sopnendu Mohanty, Chief FinTech Officer at MAS, said, “This collaboration among industry players and policymakers has helped achieve important advances in settlement efficiency, merchant acquisition, and user experience with the use of digital money. More importantly, it has enhanced the prospects for digital money becoming a key component of the future financial and payment landscape.”

Explore more

Women Face Greater Risks in the AI Workforce Transition

The rapid integration of generative artificial intelligence into the modern office environment has created a paradoxical landscape where professional survival depends less on what a worker knows and more on how easily they can abandon it. Traditional metrics typically measure the impact of technology by calculating “exposure”—essentially, how many tasks within a job description a machine can perform. However, this

Trend Analysis: Embedded Finance in Europe

The traditional paradigm of visiting a physical bank or even opening a separate lending application is rapidly becoming an artifact of the past as financial services dissolve into the digital infrastructure of daily business operations. This “invisible revolution” represents a fundamental shift where capital is no longer a destination but a native feature of the platforms where commerce actually happens.

Retail MarTech Automation – Review

The rapid convergence of high-velocity consumer data and autonomous algorithmic decision-making has effectively ended the era of manual campaign management in the modern retail landscape. Traditional marketing departments once relied on static spreadsheets and gut-feeling intuition to drive seasonal sales, but the contemporary environment demands a level of precision that human cognition simply cannot achieve at scale. Retail MarTech automation

Employee Loses New Job After Revealing Future Employer

The moment an individual decides to leave a long-term position often feels like a hard-won victory over professional stagnation and underappreciated labor. After four and a half years of dedicated service, one employee finally secured a higher-paying role that promised the recognition and financial growth they had been lacking. However, a single strategic oversight during the resignation process turned this

Dynamics NAV vs. Business Central: A Comparative Analysis

Many enterprises today find themselves operating on a digital foundation that, while outwardly functional, is silently approaching a state of structural fragility that could compromise their entire operational future. This phenomenon, often referred to as the “illusion of stability,” defines the current state of many organizations still relying on Microsoft Dynamics NAV. While these legacy systems continue to process orders