Dr Gordon Liao

This roundtable considers the work that the BIS Innovation Hub Eurosystem Centre, Singapore Centre, together with the central banks of France, Italy, Malaysia, and Singapore are pursuing to determine how FX will look like in a world of digital money.

The discussion will support this work, with the objective to:

- Promote understanding and share insights on the integration of digital currencies in the FX market.
- Identify challenges and explore opportunities presented by the intersection of FX, DeFi, and wholesale CBDCs.
- Encourage collaboration among stakeholders to shape a forward-looking FX framework that accommodates digital innovations.

This roundtable is closely tied to the work on Project Rialto, which aims to improving instant cross-border payments using wholesale CBDC settlement, details of which are available in the agenda brief. Operating under the theme of Decoding Digital Assets and Payments, this roundtable will explore the inefficiencies in today's foreign exchange markets, and the various initiatives that are being pursued to address these.

Attendees who wish to familiarise themselves with the history of the topic may refer to the reference materials here.

This roundtable is the third phase of an ongoing dialogue focused on crafting open and interoperable networks within the financial ecosystem. 

In November 2023, a roundtable titled 'Open and Interoperable Networks,' convened by the International Monetary Fund and the Monetary Authority of Singapore, delved into the necessity for multilateral platforms powered by such networks among global banks and regulators. A subsequent write-up underscored the need for advancements across technology, business, and regulations. These included rigorous testing of technology through live transactions, clearer articulation of the benefits of interoperability, and regulatory support for innovative technologies, such as through regulatory sandboxes. 

At the March 2024 gathering during the Japan FinTech Festival, a follow-up discussion titled 'Moving Money at the Speed of the Internet' was held in collaboration with the Financial Services Agency of Japan and the Monetary Authority of Singapore. The conversation addressed the challenges posed by the lack of compliant digital infrastructure for financial institutions to execute digital asset transactions at scale. Find more insights from this discussion, emphasising the crucial role of foundational digital infrastructure in supporting open and interoperable networks in the pre-reading material. 

Building on past recommendations, this third chapter brings together key stakeholders from various sectors of the financial industry to address concerns and chart a course for the future of stablecoins within the monetary system. Operating under our theme of Decoding Digital Assets and Payments, the session aims to provide guidance to regulators, support commercial banks in adapting to the evolving landscape, and encourage FinTech innovation alongside stablecoins. 

Experts on the roundtable will drive a meaningful exchange on the following:  
- An overview of the current concerns surrounding stablecoins, ranging from regulatory uncertainties to systemic risks, and insights into ongoing efforts to understand and regulate digital assets through collaboration. Consideration of the systematic impact of increasing holdings of reserve currencies by issuers 
- The role of commercial banks in the future monetary system, including opportunities in developing on-chain assets and strategies for integrating traditional banking services with emerging digital asset platforms.  
- Collaborative initiatives between FinTechs and stablecoin issuers as key drivers of innovation. Fintech leaders will be invited to share their perspectives on the intersection of innovation in the digital asset space 

Attendees who wish to familiarise themselves with the topic may refer to the reference materials below.
- Open and Interoperable Networks
- Moving Money at the Speed of the Internet
- ASAP: A Conceptual Model for Digital Asset Platforms