Singapore-based payments
company Xfers announced on Monday the official release of its XSGD
stablecoin, pegged to the Singapore dollar.

The stablecoin would
be one of the first SGD-denominated tokens, giving Singapore businesses
and individuals a way to transact with crypto backed by their national
currency. XSGD is launched on the Zilliqa and Ethereum blockchains. The
token is launched as part of Xfers’ StraitsX initiative.

The
stablecoin is said to be Travel Rule-compliant, though Aymeric Salley,
head of StraitsX, told Cointelegraph that this primarily involves PSN01
guidelines by the Monetary Authority of Singapore.

The set of
rules primarily deals with identification requirements for users, who
can only acquire or redeem the stablecoin on the Xfers platform after
full verification. Continuous risk assessment and transaction monitoring
is also required of the platform, though these rules can be seen in
many existing anti-money laundering frameworks across the globe.

Salley
nevertheless noted that Singapore’s regulations make no distinction
between different forms of e-money, which implies that cryptocurrency
firms can operate in the country as long as they “can demonstrate
compliance with a number of guidelines.”

The token itself can be freely withdrawn and transacted with non-custodial wallets, Salley said.

The
initial use cases of XSGD primarily involve financial institutions,
specifically cross-border money transfers and financial system access
for crypto-based institutions. Head of payments at Xfers Sharon Paul
told Cointelegraph:

“Payments are more often than not,
the first step in enabling financial access. With this in mind, and
observing the rise in tokenised assets, it was a natural progress for
our team to include Stablecoins into our suite of payment options. It is
with great joy to offer XSGD as an interoperable and hence seamless
settlement option for the digital assets and capital markets
industries.”

The team is pushing for the coin to be
adopted across the DeFi ecosystem as well. It is currently available on
Zilswap, a Zilliqa-based decentralized exchange. The token also exists
as an ERC-20 contract on Ethereum, which would make inclusion in DEXs
like Uniswap possible as well.

Salley highlighted that the
stablecoin space is currently dominated by the U.S. dollar, and it is
the company’s belief that other currencies should also receive
representation:

“We have seen the adoption of stablecoins
rise quickly over the years, however, 98% of the market is dominated by
USD-denominated stablecoins — we believe that now is the time for
stablecoins pegged to other national currencies such as the Singapore
Dollar to emerge.”

Singapore’s blockchain ecosystem is relatively vast,
comprising over 200 blockchain projects and investment firms alike. The
fiat gateway offered by XSGD could let these companies have an easier
time interfacing with the global crypto markets, though the country’s
crypto infrastructure does not seem particularly underdeveloped. Major
exchanges like Binance, Kraken or Coinbase serve the country through
either their global platforms, or dedicated subsidiaries.

source link : https://cointelegraph.com/news/crypto-singapore-dollar-aims-to-diversify-landscape-dominated-by-usd