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Crypto Long & Short: A Giant Awakens

by Janine Lindsey

DBS Bank, a regional banking giant based in Singapore, is taking a cautious approach to offering clients the ability to buy traditional securities using stablecoins. While DBS holds all three licenses required for this service, it has not yet implemented it, even as competitors move forward. MetaComp, the only other entity in Singapore with all three licenses, has already allowed clients to pay for securities with their crypto holdings, albeit by converting stablecoins to fiat. So why is DBS holding back?

According to Evy Theunis, head of digital assets at DBS’ institutional banking group, the bank is swimming in the crypto race, but not going as deep as some of its competitors. They believe in taking measured steps and getting their hands dirty for the long run. The main reason for not offering stablecoin services is the technical difficulty of tracking tokens. While DBS thoroughly traces the wallets of non-stablecoin cryptocurrencies, doing the same for stablecoins is much more complex due to their multichain nature and cross-bridge transactions. DBS wants to ensure everything that enters the bank is foolproof.

DBS is a major player in the finance industry in China, Hong Kong, Indonesia, and South Korea. The bank’s reputation as the “safest bank in Asia” for 14 consecutive years brings legitimacy to the crypto space with every step it takes towards adopting digital assets. DBS launched its digital asset platform, DBS Digital Exchange, in 2020, indicating its commitment to embracing the evolving landscape of finance.

Theunis, originally from Brussels, bridges the gap between the West and East’s understanding of crypto. She believes that collaboration between regulators and the industry is crucial for the growth of the ecosystem. Singapore, with its close relationship between regulators and industry players, serves as a model for other jurisdictions. DBS’ strategy aligns with the monetary policy of the region, focusing on institutional players and accredited investors rather than retail trading of digital assets.

While DBS is taking a cautious approach, it is not alone in its wait-and-watch stance. Many traditional players in the industry are readied but not actively involved in crypto. Scalability has historically been a challenge for transactions involving stablecoins, but builders are working to make blockchain technology ready for scalable adoption. DBS encourages builders to communicate with institutions about their use cases, emphasizing that it will take time for widespread adoption.

As the triathlon of digital assets unfolds, DBS may not be the reigning champion, but it knows how to win. With its measured approach and collaboration, DBS is positioning itself as a key player in the future of finance in the region.

Disclaimer: This article is not intended to be financial advice. The writer does not own any cryptocurrencies mentioned in the article.

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