The central banks of Malaysia and Thailand have joined BLOOM, an initiative led by the Monetary Authority of Singapore (MAS) to develop international payment and settlement mechanisms with digital money. The entry of Bank Negara Malaysia (BNM) and the Bank of Thailand (BOT) was announced on Friday (23).
With the accession, the three monetary authorities will work with financial institutions and technology companies to establish common procedures for acceptance, conversion and settlement of different forms of digital money between countries, institutions and payment networks.
BLOOM, short for Borderless, Liquid, Open, Online, Multi-currency, brings together public and private participants to develop infrastructure and rules that allow the operation of different digital instruments in international transactions.
BLOOM seeks to connect tokenized deposits and regulated stablecoins
The initiative encompasses tokenized bank deposits and stablecoins that meet regulatory requirements. The goal is not to create a joint currency, but to allow different instruments to be used across financial systems subject to different rules.
The work is concentrated on three fronts: international acceptance and settlement, interoperability between networks and programmable controls. The latter includes identity verification mechanisms, identification of operations subject to sanctions and restrictions applicable to transactions.
According to Leong Sing Chiong, deputy managing director of MAS, cooperation between regulators and industry participants will be necessary to resolve practical issues related to the acceptance, settlement and interoperability of digital money.
The group also brings together companies such as Mastercard, Visa, Ripple and Circle, as well as banks and the World Bank. MAS expects the standardization of commercial and operational procedures to reduce the need for separate agreements between institutions and markets.
The cooperation is still in the phase of developing structures and procedures. The announcement does not set a date for the commercial operation of an integrated infrastructure nor does it present transaction volumes processed by BLOOM.
