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Boosting MSME Trade: Bank of Ghana and MAS Complete DESFT Project

Bank Of Ghana And Singapore

The Bank of Ghana (BOG) and the Monetary Authority of Singapore (MAS) have finished a proof-of-concept for the Digital Economy Semi-Fungible Token (DESFT) Project. This new project is intended to promote trade between micro, small, and medium enterprises (MSMEs) in Ghana and Singapore by means of digital currencies and credentialing technology.

Live Transactions and Technology

The DESFT project enabled live transactions between Ghana and Singapore by means of the semi-fungible token protocol, Universal Trusted Credentials. It is through this protocol, created by the United Nations Development Program, that verified licenses, certificates, and trade records are included. The Singapore-based Ample FinTech, which is the project developer, gave this information.

Digital Currencies in Action

A stablecoin linked to the Singapore dollar (XSGD) and the Bank of Ghana’s e-cedi central bank digital currency (CBDC) were transferred through the Purpose Bound Money protocol. This protocol, which was designed by MAS and the International Monetary Fund with the help of central banks from Italy and South Korea, is intended to be a tool for programmable money and payment technology. The protocol has already been applied by major retailers like Amazon, and it has been successful.

Insights from Key Figures

During the 3i Africa Summit in Accra, the Bank of Ghana’s director of fintech and innovation, Kwame Oppong, talked about the project’s success. He said, “After almost a year and two phases of development, we have produced an information exchange solution that is based on UTC standards and semi-fungible token technology […] Moreover, real-world trade experiments were conducted, which fully complied with our preset objectives. ” He also added that future development would be focused on supply chain finance and payments in multiple digital currencies.

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Future Prospects and Technology

Information about the semi-fungible token technology is scarce, but Ample FinTech disclosed that it uses the ERC-3525 standard on the Ethereum blockchain. As per the announcement of the Singapore Fintech Festival scheduled for November 2021, the Digital Economy Semi-Fungible Token “is a combination of NFTs and traditional blockchain information,” thus allowing self-ownership to be tokenized through DESFT.

The e-CEDI is still in the pilot phase, and there is no official launch date. Nevertheless, the realization of the DESFT proof-of-concept is a big step towards boosting trade between MSMEs in Ghana and Singapore using advanced digital currency and credentialing technologies.

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