Singapore has the foundation to lead tokenised capital markets in Asia. This deck proposes the concrete infrastructure to build on it.
The shift from electronic to tokenised capital markets is the defining infrastructure transition of this decade; the standards and architecture are being set now, by those who move first
Singapore is positioned to set the regional standard, export the model, and become the settlement and liquidity hub for ASEAN tokenised markets
This deck proposes a four-component foundational framework: digital money, tokenised risk-free collateral, digital issuance and registry infrastructure, and trading, clearing and settlement infrastructure. Each is a prerequisite for the one above; all are oriented toward production
The framework is whole-of-market by design; fragmentation in a market of Singapore's scale is self-defeating, and common rails are the only path to meaningful liquidity
The monetary and collateral components cannot be built by the market alone; their realisation depends on decisions that MAS and MOF are uniquely placed to make
Legal and regulatory refinements are important elements, recognised here as context but outside the scope of this deck
The tokenisation of capital markets is a structural shift already in motion; Singapore's opportunity is to lead it
Capital markets have digitalised once before; the move from physical certificates to electronic book entries created the infrastructure that has run global markets for 40 years
That infrastructure is now the constraint: fragmented, nationally siloed, and incapable of atomic settlement or real-time collateral mobility
Tokenisation rebuilds the substrate as programmable, portable, and natively digital, free of those inherited constraints
Singapore's opportunity is to define the regional standards and build the first production infrastructure before the default is set elsewhere
Context
The shift is already underway. Singapore's window is now.
The institutional infrastructure for tokenised capital markets is being built now, and a clear architecture is emerging
The US, Europe and Switzerland have moved decisively, and the direction is consistent
SNB: wCBDC1 pilot operating in a live production environment since December 2023, extended through mid-2027
Nasdaq: dual-track tokenised securities framework approved by the SEC in March 2026, the first of its kind at a major exchange
ECB: two-track digital euro path committed in February 2025
All three follow the same pattern: government securities as the collateral anchor, sovereign digital money as the settlement layer, permissioned institutional networks as the infrastructure foundation
Each element maps directly to the proposed framework
Canton Network has built the most credible institutional base for a permissioned settlement ledger
DTCC and Euroclear are co-chairs of the Canton Foundation
Digital Asset, Canton's developer, counts BlackRock, Goldman Sachs, Nasdaq, Citadel Securities, S&P Global, and Blackstone among its institutional backers
Canton currently represents the most defensible hypothesis for an institutional-grade permissioned settlement network
Singapore can capture local market depth, regional liquidity, and global capital access; the infrastructure enabling each must be built now
Local market depth: SGX and CDP retain full primacy over listings, pricing, trading rules, and market structure; what changes is the settlement layer, and the gains from that change are near-term and tangible
Settlement compression and real-time collateral mobility deliver faster capital recycling, reduced margin requirements for clearing members, and collateral that was previously locked becoming mobile
These gains accumulate incrementally; they do not require the full framework to be in place before the first improvement is felt
Regional liquidity: cross-border issuance, pooled collateral, and common order flow become viable on shared rails for the first time; the commercial logic has always existed, the infrastructure has not
Near-term: a regional company raises capital from investors across multiple markets in a single tokenised issuance; a Singapore institution posts tokenised SGS as collateral on a cross-border position without a separate custody arrangement
Aspirational but grounded: common ASEAN collateral pools, cross-border margin netting, Singapore as the natural regional clearing venue; each depends on commercial and regulatory alignment across participating markets, but the infrastructure this framework proposes would remove the technical barrier that has blocked them until now
Global capital access: international institutions access Singapore and ASEAN-listed securities through the same DTCC or Euroclear infrastructure they use for everything else; the operational complexity that currently makes ASEAN a difficult allocation largely dissolves
The DTCC-Canton partnership provides the near-term foundation: SGX-listed tokenised securities on the same ledger as the world's largest settlement infrastructure, with direct access to international liquidity
Cross-listing with western venues becomes operationally simpler on shared rails: a single tokenised share class, one settlement system, no reconciliation between registers
The Framework
Four building blocks, each a prerequisite for the one above
Digital money is the precondition for tokenised capital markets; the two must be designed and built together
A tokenised asset settling against an off-chain cash leg replicates settlement risk in a new format; it does not eliminate it
Capital recycling and programmatic delivery-versus-payment2 both require cash and assets on the same ledger; settlement risk is eliminated by the mechanics of the ledger itself, not through contractual novation by a central counterparty
Every design decision in the asset components must be taken with knowledge of what the money component will look like when they meet
Both components can and must be built concurrently; what the dependency logic demands is coordinated design with clear interfaces between components from the outset
Singapore's market is too small to absorb fragmentation; disparate proofs of concept across incompatible digital money instruments compound rather than advance it
Four building blocks, each a prerequisite for the one above: the complete architecture for a production-ready tokenised capital market
All four components can and should be built concurrently; the dependency sequence governs design decisions and interface points, not the execution order
Each component must be production-ready when the one above it needs it; the sequence determines where design choices are made and where failure propagates
Building Block 1: Digital money: wholesale digital SGD, tokenised commercial bank deposits, and regulated stablecoins
Provides the on-chain cash instruments that make atomic settlement possible
Building Block 2: Tokenised risk-free collateral: SGS issued and settled on-chain, the sovereign anchor of the tokenised market
Without on-chain sovereign collateral, the tokenised market has no risk-free anchor and no atomic clearing capability
Building Block 3: Digital issuance and registry infrastructure: the digital ledger on which tokenised securities are issued, recorded, and transferred, built on Canton Network
Replaces fragmented, nationally siloed registries with a single programmable layer designed for regulated institutions
Building Block 4: Trading, clearing and settlement infrastructure: the market infrastructure through which tokenised securities are traded and settled, with delivery-versus-payment2 in digital money
Atomic settlement on a shared ledger is the end-state; the near-term step is batched intraday settlement, compressing cycles progressively toward real-time
Compressed settlement reduces risk, frees capital sooner, and enables real-time collateral mobility at every stage of that progression
Building Blocks 1 & 2
Digital money and tokenised collateral: the monetary and collateral foundations
Singapore's digital money architecture requires two tiers, each with a distinct function
Tier 1: MAS-issued digital SGD and regulated SGD stablecoins form the sovereign and near-sovereign settlement tier
MAS-issued digital SGD is the risk-free settlement instrument: a direct liability of the central bank, providing final and irrevocable settlement
Regulated SGD stablecoins, issuable under the MAS Stablecoin Framework already in place, provide a near-sovereign complement once licensed issuers are operational
Tier 2: Tokenised deposits issued by DBS, OCBC, and UOB constitute the working commercial money layer on the same ledger as the securities being settled
Capital markets do not settle in central bank money today; tokenised deposits are the commercial bank money of the existing settlement system placed on-chain
They preserve the two-tier monetary structure, the bank credit function, and the intraday liquidity that high-volume settlement requires
Together, the two tiers replicate the full monetary architecture on a digital ledger: sovereign money as the anchor, commercial bank money as the working instrument
The digital money settlement gap is solvable now, without new regulatory permissions
Moving the MAS SGD Testnet9 to production is the logical next step toward the local market depth described in the strategic vision. The tokenised market does not have to wait for that transition to be complete
Tokenised SGD deposits issued by DBS, OCBC, or UOB under existing licensing can be implemented today
Commercial bank money on a digital rail, not a new instrument class
No stablecoin authorisation or new regulatory permission required
Once licensed issuers are operational, the MAS Stablecoin Framework provides an additional pathway, reinforcing the settlement stack further
Central bank money, tokenised commercial bank deposits, and regulated stablecoins form a settlement stack with no gap
On-chain settlement can begin with tokenised deposits today; wCBDC and regulated stablecoins deepen the stack as each becomes available, without requiring the others to be in place first
09 — Building Block 1: Digital Money (Regional and International)
Singapore exports standards, technology, and connectivity; each ASEAN jurisdiction issues its own currency on shared rails
Singapore's exportable product is threefold: the policy template, the technical framework, and the connectivity infrastructure through which regional jurisdictions plug into shared rails
Policy template: the MAS stablecoin framework and digital money standards as an adoptable model for regional central banks
Technical framework: GL13-compatible, ISO 2002210-aligned implementation templates defining how market participants interconnect to build a complete digital money offering on shared infrastructure
Connectivity infrastructure: Canton gateway APIs through which local market participants connect to the shared settlement infrastructure
Singapore-regulated platforms accommodate USD digital instruments as a practical matter
USDC, under the US GENIUS Act framework enacted July 2025, for cross-border settlement involving US counterparties
Tokenised USD deposits from internationally active banks as the working settlement medium for USD-denominated transactions
USD instruments operate under Singapore-regulated platform rules; monetary sovereignty is not compromised
Singapore exports the standard and the technology that embeds it; sovereignty over issuance remains with each jurisdiction
10 — Building Block 2: Tokenised Risk-Free Collateral (Local)
Tokenised SGS is the sovereign anchor of Singapore's tokenised capital market, and arguably its single most consequential infrastructure opportunity
Government securities form the collateral backbone of every capital market: used in repo, posted as margin, and central to the benchmark yield curve; in a tokenised market, they must be on-chain to function atomically
Off-chain SGS cannot serve on-chain repo, margin calls, or atomic clearing without reintroducing the settlement risk the tokenised market is designed to eliminate
DTCC's December 2025 Canton partnership opened with US Treasury securities for exactly this reason: the collateral anchor comes first
A tokenised market without on-chain sovereign collateral has no risk-free anchor
On-chain collateral defaults to private credit instruments
Private credit carries credit risk and degrades precisely when stress hits and collateral is most needed
Unlike the digital money component, which can be bridged by tokenised deposits while wCBDC1 reaches production, the collateral anchor has no equivalent interim solution; tokenised SGS is the only path
Tokenised SGS, issued alongside the existing SGS auction process and settled in digital SGD, closes that gap
It is the on-chain risk-free asset on which Singapore's entire tokenised collateral architecture rests
11 — Building Block 2: Tokenised Risk-Free Collateral (Local)
Real-time collateral mobility is the highest-value near-term application; a single day of US settlement compression released USD 3 billion in margin
Tokenised SGS movable between clearing accounts in real time reduces the collateral haircut and liquidity premium that clearing members must hold today
Collateral efficiency gains from settlement compression alone are documented
USD 3bn
Released in margin when the US moved from T+2 to T+1 in May 2024 — compressing by a single day, without any tokenisation
NSCC7 Clearing Fund · DTCC/SIFMA After Action Report
Atomic settlement of tokenised securities with real-time collateral mobility produces a larger improvement still
Singapore's specific magnitude is a function of SGX-DC clearing volumes and collateral haircuts; clearing members can calculate it directly
12 — Building Block 2: Tokenised Risk-Free Collateral (Regional and International)
Tokenised SGS is also Singapore's most exportable infrastructure asset: a replicable model for ASEAN sovereigns and a bridge to international collateral markets
Together, tokenised SGS and tokenised US Treasuries form the complete on-chain risk-free collateral layer: sovereign in SGD, internationally connected in USD, and exportable as a model across ASEAN
For ASEAN, tokenised SGS is the proof of concept that matters most
A sovereign bond issued on Canton, settled in digital SGD, with open-source issuance templates: a complete and replicable model
Singapore does not export SGS; it exports the architecture, the standards, and the technology through which any ASEAN sovereign can tokenise its own government debt on shared rails
For global capital access, tokenised US Treasuries provide the USD-denominated risk-free collateral layer
US Treasuries are the global collateral benchmark; their on-chain availability alongside tokenised SGS completes the collateral picture for institutions operating across both SGD and USD markets
Building Blocks 3 & 4
Registry, trading, and settlement: the market infrastructure
13 — Building Block 3: Digital Issuance and Registry Infrastructure (Local)
Canton is the defensible choice for Singapore's digital securities infrastructure: technically suited and institutionally adopted
Adoption is the governing argument: Canton has assembled the institutional base that no other permissioned network can match
DTCC and Euroclear are co-chairs of the Canton Foundation
Digital Asset, Canton's developer, counts BlackRock, Goldman Sachs, Nasdaq, Citadel Securities, S&P Global, and Blackstone among its institutional backers
Canton is technically suited to regulated capital markets infrastructure from the ground up
Designed for permissioned institutional networks from the outset, with privacy-preserving sub-transaction visibility
DAML6-based smart contract execution with atomic DvP2 at the ledger level
Built for regulated financial market infrastructure, not retrofitted to it
Singapore's interoperability objective is served directly by being on the same network as the institutions its market needs to reach
In network infrastructure, network effects compound; late adoption means catching up, not plugging in
Canton is the most logical choice at this stage; alternative permissioned networks exist, but none currently combine the same institutional adoption with direct connectivity to western settlement infrastructure
14 — Building Block 3: Digital Issuance and Registry Infrastructure (Local)
The commitment to Canton is deliberate; the framework is portable if network conditions change
Architectural flexibility is maintained by separating legal rights and business logic from the smart contract implementation
Legal rights attached to tokens (ownership, transfer entitlements, economic claims) are defined via legal framework, not encoded in smart contracts
Business logic, covering matching engines, settlement sequencing, and position management, connects via adaptor and can be maintained independently of the underlying network
Both can be migrated to a different network without rebuilding from scratch; the Canton commitment is considered, not irreversible
Alternative permissioned networks exist and have been used in Singapore's own pilots
R3 Corda featured in MAS Project Guardian pilots
The separation of rights and logic from the network layer keeps the exit open without deferring the production commitment to Canton
CDP is working with Hydra X on Canton integration covering on-chain issuance, digital registry, and DTCC interoperability; the business logic layer is designed to operate independently of the underlying network, connected via adaptor rather than embedded in it
This architecture provides the technical foundation for the production testing timeline set out in Building Block 4
Shared infrastructure is what makes regional liquidity achievable: previous attempts had the commercial vision but not the plumbing
The ASEAN Trading Link had the right ambition: cross-border order routing across Singapore, Malaysia, and Thailand. It had no centralised clearing and settlement; the commercial vision was sound, the post-trade infrastructure was not
Shared settlement infrastructure is a different proposition: interoperability is built into the foundation from the outset rather than bolted across the top of incompatible systems
Where commercial interest and political will exist, shared rails allow them to act; the infrastructure no longer stands in the way
The choice every ASEAN jurisdiction faces in modernising its capital market infrastructure is whether to build on tokenisation-native architecture or updated legacy; the marginal cost of the former is low, and the timing advantage is real
No other ASEAN jurisdiction currently has the institutional depth to build this infrastructure
Hong Kong's Project Ensemble is the nearest competitive move in the region; the window remains open, but it will not stay that way
17 — Building Block 3: Digital Issuance and Registry Infrastructure (Regional)
Every ASEAN participant retains local control; the network is designed to have no single owner
The sovereignty objection is the first objection in every ASEAN bilateral conversation; it deserves a direct answer
A distributed ledger has no single owner. That is the point
Each participating jurisdiction issues on its own terms, under its own regulatory perimeter
Each retains full governance over its own market and participant rules
Singapore has the opportunity to help build shared infrastructure and connect ASEAN markets to the network; every participant operates as an equal validator
Local control extends across the network; Singapore is one node among many
Local control, regional liquidity, and global capital access apply to every participant, not only to Singapore
Canton Foundation governance reinforces this by design
Governed under the Linux Foundation with decentralised structures designed to prevent single-entity control
No participant, including Singapore, holds unilateral authority over protocol decisions
18 — Building Block 3: Digital Issuance and Registry Infrastructure (Regional and International)
The market penetration opportunity is greatest where infrastructure is absent: edge markets are the natural starting point, with international connectivity from day one
Asset classes where ASEAN exchanges carry no entrenched registry infrastructure offer the lowest-friction market entry
Digital bonds, sukuk, carbon credits, and private credit are the most immediate opportunities; no incumbent has established a position across these in ASEAN
The same framework accommodates broader adoption as it proves out; the starting point is not a ceiling
For global capital access, DTCC and Euroclear are building toward full production on Canton, targeting H2 2026
SGX-listed tokenised securities will sit on the same ledger as the two largest global settlement infrastructures from day one
Direct access to international institutional liquidity without a separate integration layer
19 — Building Block 4: Trading, Clearing and Settlement Infrastructure (Local)
A dual-track approach is one sensible transition path to atomic settlement; off-chain business logic keeps the full stack portable
A dual-track model, in which tokenised and traditional securities trade under the same identifier, the same rules, and the same investor rights with settlement route determined by instrument format, is one sensible way to preserve liquidity through the transition
The SEC approved Nasdaq's framework for exactly this architecture in March 2026; SGX's T+2 equities and T+1 government bond cycles are the starting point for progressive compression
The settlement compression benefits documented in Building Block 2 apply at every stage; the near-term step is batched intraday settlement, building toward real-time
Market-facing business logic (matching engine, pre-trade risk, collateral calculation, position management, and post-trade reconciliation) sits off-chain and connects to the settlement layer via adaptor, rather than being embedded in it
Existing implementations of each component can be integrated with relatively contained adaptation work
Each component can be updated or migrated independently as the settlement layer evolves
This architecture means issuers, investors, and market participants can adopt tokenised settlement incrementally, using adapted market logic throughout the transition, until critical mass makes full migration the natural path
Singapore is positioned to fill the ASEAN vacuum; the infrastructure it exports is a functioning stack, not a standard without a home
No ASEAN jurisdiction currently has the standards, the plumbing, or the institutional expertise to build regional tokenisation infrastructure
Countries are watching and want to participate; none yet has the capability to build
Singapore enters a space to build in, not fight through, with MAS regulatory credibility, SGX institutional relationships, and established connections to DTCC, Euroclear, and the BIS already in place
What Singapore exports is a complete, production-ready stack: digital money, tokenised collateral, registry, trading, and settlement; each component proven before it is offered to the region
Any regional exchange or CSD can connect its own market logic via adaptors and access shared settlement infrastructure without a complete architectural overhaul
The framework is designed to keep integration work relatively minimal; adoption can be sequenced rather than all-or-nothing
The natural entry point is the edge markets: digital bonds, sukuk, carbon credits, and private credit, where ASEAN exchanges carry no entrenched registry infrastructure and no incumbent has established a position
These are not peripheral asset classes; they are the lowest-friction path into markets that will broaden as the framework proves out
The ambition is infrastructure ownership; the Nasdaq and ICE precedent shows where durable strategic value lies
Nasdaq and ICE grew substantially through acquisition. That is not the relevant precedent
What they became is the model: infrastructure and technology companies whose revenues are independent of their own listing volumes
Both now serve markets they nominally compete with, providing standards, registry, clearing, and settlement technology to exchanges across multiple jurisdictions
Singapore's path to an equivalent position in ASEAN is organic rather than acquisitive, which is harder and slower. The destination is the same
Owning the rails others depend on, with the revenue durability and strategic leverage that follows
Listing rankings and AUM tables fluctuate; infrastructure ownership compounds
The full architecture is required for this ambition to be realisable
A network standard in isolation can be proposed but cannot be exported to production
Money, collateral, registry, trading, and settlement: all five layers operational, creating the capability that others can adopt and depend on
Singapore does not connect the spokes; it owns the rails they run on
SGX · CDP · MASFirst and primary user of the rails
Singapore Infrastructure Layer
Digital Money
Tokenised Collateral
Issuance & Registry
Trading & Settlement
▶
DTCC
Euroclear
International
Indonesia
Malaysia
Thailand
Philippines
Vietnam
Hong Kong
Each market connects to the rail, not to Singapore's node. Equal participants in shared infrastructure.
Each ASEAN market issues on its own terms, clears on shared rails, and connects to international liquidity through infrastructure Singapore built and maintains. Governance of that infrastructure is decentralised by design; no participant, including Singapore, holds unilateral control.
Implementation
Coordination, sequencing, and what can be built now
Banks are structurally central to tokenised capital markets, and the commercial opportunity is genuine
Tokenisation changes the infrastructure on which banks operate; credit provision, liquidity making, risk transformation, and client distribution remain bank functions
Tokenisation modernises the layer beneath bank intermediation; the intermediation itself remains
Collateral management across tokenised platforms is a particularly significant commercial opportunity
Actively managing tokenised SGS on behalf of clearing members is a new business line with genuine pricing power, not a repackaging of an existing one
The collateral pool that clearing members currently hold as a static buffer becomes, under this framework, a dynamically managed asset; the bank that manages it best earns a defensible and scalable revenue stream
The broader revenue set is new, defensible, and scales with market volume
Issuance agency and trusteeship, institutional digital asset custody, market-making in tokenised secondary markets, tokenised deposit infrastructure for settlement
Each of these is a growth line rather than a migration of existing revenue; the total addressable market expands with the infrastructure
Singapore's domestic banks are well-positioned to lead
DBS, OCBC, and UOB carry the relationship advantage, the regulatory standing, and the local knowledge that international banks entering the region cannot replicate
Goldman's Digital Assets Platform is already on Canton and building into tokenised settlement and custody; Singapore's banks have the home advantage, and the window is open
The building blocks have a clear dependency order; the programme can and should be built concurrently
Each building block has a natural order: digital money must exist before collateral can be anchored on-chain; collateral must be on-chain before the registry can function atomically; the registry must be live before settlement infrastructure can clear
This order governs design decisions: each component must be built with the one above it in mind. It also determines where problems propagate if something falls short
That order does not mean building one thing at a time; it means building all four concurrently, with clear handoff points agreed in advance
Each component needs to be production-ready when the one above it needs it: not before, but not after either
Working sequentially would extend the programme by years and surrender the standards-setting window to other jurisdictions
The Swiss precedent demonstrates the model
The SNB, SIX, and the commercial banks ran concurrent workstreams on the wCBDC1 pilot, SDX8 registry infrastructure, and tokenised bond issuance
Meaningful output across all three arrived within a compressed window because no component waited for another
Three capabilities in development now, ready for production-level testing within 12 to 18 months
CDP is working with Hydra X to build the Canton integration capabilities described in this framework
Three capabilities will be ready for testing in a production-equivalent environment within 12 to 18 months:
On-chain collateral issuance and acceptance on Canton
A digital registry track operating alongside existing CDP infrastructure
Live interoperability with DTCC on the same Canton network
This integration is the technical beachhead: the operational foundation from which the components above can be built as MAS and the banking sector move on their respective workstreams
It allows Singapore to demonstrate capability to DTCC, Euroclear, and regional participants, rather than project it
Four areas are awaiting decisions; progress on any one of them advances the whole
These are not aspirational items; the technical foundation for three of the four is already in development.
Wholesale digital SGD: moving the MAS SGD Testnet9 from pilot to limited production for approved institutional participants
Tokenised SGS: launching a tokenised SGS tranche alongside the existing auction programme
Tokenised deposits: implementing tokenised SGD deposit infrastructure by Singapore's major banks
Market infrastructure: integrating new or updated market logic (matching, settlement, risk, collateral management) with existing SGX and CDP infrastructure via Canton
29
This treatment represents one considered view of how Singapore could approach the current opportunity, and lead the next era of Asian capital markets.
1wCBDC — wholesale central bank digital currency: digital money issued by a central bank directly to regulated financial institutions, not the public. Distinct from retail CBDC, which would be issued to individuals.
2DvP — delivery-versus-payment: the simultaneous exchange of securities and cash that eliminates the settlement interval and the counterparty risk that arises when one leg settles before the other.
3GL1 — Global Layer One: the BIS-convened initiative establishing common standards for cross-border tokenisation interoperability among regulated institutions.
4BIS Agora — a multi-central-bank programme exploring tokenised commercial bank deposits and wCBDC on a shared platform across jurisdictions.
5Project Meridian — Bank of England model for synchronising traditional RTGS settlement infrastructure with tokenised asset rails during the transition period.
6DAML — the native programming language developed by Digital Asset for financial smart contracts on Canton, designed specifically for privacy-preserving settlement logic in regulated institutions.
7NSCC — National Securities Clearing Corporation: the US central clearing counterparty, a subsidiary of DTCC.
8SDX — SIX Digital Exchange: Switzerland's fully regulated distributed ledger-based financial market infrastructure, licensed by FINMA to operate as both a stock exchange and a central securities depository.
9MAS SGD Testnet — the Monetary Authority of Singapore's pilot infrastructure for wholesale digital SGD, providing a controlled environment for testing central bank digital currency settlement between approved institutional participants. Moving to production would make digital SGD available for live institutional settlement transactions on a DLT-based platform.
10ISO 20022 — a global standard for electronic data interchange between financial institutions, increasingly adopted by central banks, SWIFT, and settlement infrastructures worldwide for payments and securities messaging. Alignment with ISO 20022 ensures any implementation speaks the same language as the world's major payment and settlement systems.
Food for Thought
Discussion notes on three questions arising from the framework
CDP's evolving role under atomic settlement · The practical case for tokenised SGS · How the interbank settlement layer could work
Question 1
CDP's evolving role under atomic settlement
30 — Post-Trade in a Tokenised Market
Atomic settlement progressively displaces both of CDP's core functions; where netting resides in the future is worth examining now
CDP's clearing function rests on two operations: novation (interposing as counterparty, absorbing settlement risk) and multilateral netting (compressing gross obligations to net before settlement)
Atomic settlement displaces novation directly
When securities and cash settle simultaneously on a shared ledger, counterparty risk is eliminated by the settlement mechanics themselves
Each step from T+2 toward real-time narrows the window in which novation adds value; at continuous atomic settlement, that window closes entirely
Netting survives as an operation but migrates naturally toward the banks
In batched settlement, trades within each batch can still be netted before the batch settles atomically; CDP could retain this function for as long as batching persists
As batch windows compress, the volume available for netting shrinks, and the capital efficiency gain shrinks with it
At continuous atomic settlement, the securities leg settles gross, trade by trade; the banks, not CDP, are the parties accumulating and netting residual cash obligations
CDP could evolve to serve the netting function on behalf of the banking layer; the point is that the function follows the cash, and the cash sits with the banks
As both functions evolve, the question of what operational role underpins CDP's designation as national depository becomes worth addressing before the direction of travel makes it unavoidable
Questions worth having early.
Question 2
The practical case for tokenised SGS
31 — SGS and US Treasuries
The case for tokenised SGS must be assessed on Singapore-specific terms; it cannot be imported from the US Treasury playbook
US Treasuries: nearly USD 30 trillion outstanding, over USD 4 trillion in daily repo volume, continuous circulation across thousands of participants; a product of supply, reserve currency status, and decades of purpose-built infrastructure
SGS: approximately SGD 179 billion outstanding; created for yield curve development and bank liquidity requirements, not deficit financing
At SGX-DC, non-cash collateral is predominantly US Treasuries and JGBs, for reasons of settlement currency and funding economics; SGS is eligible but secondary in practice
MAS operates an Enhanced Repo Facility for primary dealers within fixed hours; no deep, continuous repo market equivalent exists
Tokenisation does not change the supply, the currency composition of derivatives exposures, or the reserve status of the SGD; the opportunity lies in removing the operational constraints on how existing SGS is used
32 — Collateral Velocity
Tokenised SGS could turn a static regulatory buffer into a dynamic instrument; the smaller the supply, the higher the value of each additional turn
SGS held by banks today are overwhelmingly static: parked in custody to satisfy High Quality Liquid Asset requirements under Basel III, or held as a long-duration investment
Each movement between accounts requires matched SWIFT instruction pairs into MEPS+, settled within fixed operating hours; tolerable for a static buffer, a binding constraint for dynamic collateral use
Tokenised SGS on a shared ledger would compress that overhead significantly
Collateral moves as a ledger operation rather than a separate settlement event per transfer; available beyond MEPS+ operating hours
Margin calls, repurchase returns, and substitutions could execute on the ledger when counterparties trigger the action; the ledger can enforce atomicity and conditionality at each step
One unit of SGS currently serves one function at a time; tokenised SGS could be repo'd during the day and returned before the reporting snapshot, satisfying the HQLA requirement and generating secured funding within the same 24 hours
Each additional turn is proportionally more valuable when risk-free supply is structurally limited
33 — SGS Repo Market
Singapore lacks a deep SGS repo market primarily because per-transaction cost is disproportionate at current scale; tokenisation offers a path to compressing that cost
The US Treasury repo market sustains over USD 4 trillion daily because its infrastructure has been optimised over decades to minimise per-transaction cost
In Singapore, each SGS repo transaction requires separate matched instructions through MEPS+ for delivery, return on the repurchase date, and any margin or substitution events during the term; that overhead is too large to support the continuous, high-frequency activity that builds a liquid funding market
Repo on a shared ledger would compress the full lifecycle
At inception: SGS tokens and digital cash move simultaneously on the ledger
On the repurchase date: the reverse leg settles on the agreed date
During the term: margin calls, substitution, and early termination could execute on the ledger when triggered by the relevant counterparty; the ledger can enforce atomicity and conditionality at each step
Broadridge's DLR platform processed approximately USD 7 trillion in tokenised repo in January 2026, averaging USD 365 billion daily; the mechanics of ledger-based repo are demonstrated at institutional scale
MAS's direction is consistent: the November 2025 announcement included trialling tokenised MAS Bills with primary dealers, settled in wCBDC1; a short-duration instrument, but it validates the same mechanics a broader SGS repo programme would require
34 — Three Stages of Value
Collateral mobility first, then an SGS repo market, then the regional model; each would build on the one before
These stages are logical possibilities, not forecasts; each advances only if the participants find sufficient commercial value in the one before it.
First: tokenised SGS as eligible margin collateral at SGX-DC with real-time mobility
Fewest counterparties required and the most directly quantifiable benefit; clearing members could calculate the capital released from moving static SGS buffers to dynamic collateral serving both HQLA and margin functions
Could begin once a tokenised SGS tranche is issued, potentially through CDP
Second: an SGS repo market enabled by tokenised infrastructure
MAS's Enhanced Repo Facility as the potential anchor, broadened beyond primary dealers, with ledger-based repo mechanics
Would create the SGD secured funding market Singapore currently lacks at scale
Third: tokenised SGS as the proven, replicable model for ASEAN sovereign debt
A sovereign bond tokenised, settled in digital SGD, with the standards and architecture demonstrated domestically before they are offered to the region
Singapore's value to ASEAN counterparts is the working precedent and the expertise to guide adoption; this depends on the first two objectives being in production
Question 3
How the interbank settlement layer could work
35 — Settlement Scenarios
The seller receives funds through the banking layer; the path depends on whether buyer and seller share a bank
Scenario 1: same bank (both parties at DBS, by way of illustration)
Atomic DvP2: tokenised securities and deposits transfer simultaneously on the ledger; DBS credits the seller immediately; no interbank movement required
Scenario 2: different banks (buyer at DBS, seller at OCBC, by way of illustration)
Atomic DvP locks the trade: securities transfer to the buyer; the buyer's bank would commit an irrevocable payment obligation to the seller's bank
The seller's bank verifies that the securities leg has settled and pre-credits the seller on the strength of that verification and the irrevocable obligation
Intraday credit exposure between the two banks clears when interbank settlement occurs; identical in nature to the exposure banks carry today on PayNow and FAST
Scenario 3 (theoretical): wCBDC1 in production
Atomic DvP transfers securities and wCBDC simultaneously; no interbank credit exposure arises
One possible long-term configuration; would eliminate the interbank credit step entirely
36 — Netting Migration
Interbank netting is the logical successor to CDP multilateral netting; the operation survives, the locus changes
Today, CDP nets both legs: all gross trades compressed multilaterally, only net obligations move on settlement day
In a tokenised model, the securities leg settles atomically; CDP's securities netting function would have no residual role on the securities side
Capital efficiency of securities netting is replaced by the capital efficiency of atomic settlement itself
The cash leg is where netting logically migrates: banks accumulate bilateral obligations through the trading day and calculate multilateral net positions at a defined cycle, settling only the net via MEPS+ or wCBDC1
The institutional form is a design choice: bilateral arrangements between banks, a multilateral utility operated by the banks or MAS, or CDP in an evolved role
37 — Batch to Continuous Settlement
Batched intraday settlement is the realistic near term; each compression of the batch window shifts more netting from CDP to the interbank layer
Stage
Settlement model
Where netting sits
Stage 1 (near term)
End-of-day batch. Trades netted and settled atomically at close.
CDP retains netting role. Banks settle net interbank positions once daily.
Stage 2 (medium term)
Intraday batches, two to four cycles per day. Smaller batches, less netting per cycle.
CDP netting delivers progressively less capital efficiency as batch sizes shrink.
Stage 3 (potential end-state)
Continuous atomic settlement. Each trade settles as it matches. Securities move gross.
Banks net interbank cash on their own cycle. CDP netting no longer operative in its current form.
At every stage, the seller receives funds promptly: through internal book entry (same bank) or bank pre-crediting on a verified commitment (different banks). The interbank cycle determines when credit exposure clears, not when the seller is paid.
