Deputy Prime Minister and Coordinating Minister for Economic Policies Heng Swee Keat delivered the keynote address at the Point Zero Forum in Zurich, Switzerland today (June 22).
The forum is an exclusive gathering of world leaders, founders and investors, and is co-hosted by Singapore and Switzerland. Notable speakers at the event include regulators, startup leaders, and many more.
During his keynote address, DPM Heng pointed out several important trends in the fintech and crypto space.
A new wave of technology is here
While DPM Heng noted that the new wave of technology, in the form of Web3.0, blockchain, non-fungible tokens (NFTs), and decentralized autonomous organizations (DAOs), is here, it is also the case that the previous wave of Technology has not yet run its course.
“Artificial intelligence (AI), Internet of Technology (IOT), and big data have become more prevalent, but there are still untapped opportunities. A new wave of technology is emerging in the form of Web 3.0, blockchain, NFT and DAO; these technologies are not as well understood or defined, but they could be game-changers,” he said.
DPM Heng also expressed his hope that the Point Zero Forum can be a place where both the public and private sectors jointly seek to strengthen the circulation of innovation, expand opportunities between Europe and Asia, and use these emerging technologies for good.
He suggested that the regulatory approach Singapore has taken will likely accommodate these new technologies, citing successes with previous AI and machine learning tech waves.
Each new wave of technology is often greeted with a mixture of optimism and skepticism. What we have gradually come to accept today was not as widely accepted back then, but we do not allow technology to evolve by chance.
Instead, the tech community and regulators actively shaped the technology to bring out its best potential, while mitigating the risks. The same approach of encouraging advantages and minimizing disadvantages applies to Web3.0, which creates many possibilities.
-DPM Heng Sweet Keat
Addressing recent crypto price volatility and the high-profile failure of the Terra UST-Luna project, DPM Heng also argued that the value of blockchain and digital assets lies apart from crypto assets, and suggests that blockchain technology can be used for cross-border transactions. .
We can also explore other use cases to improve efficiency, accessibility, and affordability.
The fintech community faces challenges, but also many opportunities
One of the main points DPM Heng addressed was the state of the fintech industry.
He noted that access to capital has become more difficult with rising interest rates and falling valuations, as well as a general rise in skepticism following the bankruptcy of several high-profile crypto firms.
There are also geopolitical instability and macroeconomic challenges, all of which pose significant problems for the development of the fintech industry.
However, DPM Heng also sees the fintech industry’s growth so far as strong, with a record over US$210 billion invested in fintech last year.
Fintech has improved countless lives, including connecting digital finance with millions who would otherwise be unbanked. Fintech is driving better outcomes: altering existing business models for the better, creating good jobs, and guiding us toward a greener future.
-DPM Heng Sweet Keat
At the same time, he warned that there are also major issues that the fintech industry has to deal with, with greenwashing being a prominent issue. Citing Morningstar’s recent move to remove ESG labels from around 20 percent of its funds, DPM Heng stated that the scale of greenwashing is concerning, calling the practice “the bane of global financial systems.”
According to DPM Heng, this is also an area where green finance technology can be further used to detect greenwashing and improve the quality of green finance over time.
Regulators are not enemies of business
DPM Heng also emphasized that regulators and companies share a common goal in using finance and technology to create value and improve lives. As such, there is no need for regulators and companies to take an adversarial approach.
Instead, DPM Heng advocates a public-private partnership, to encourage and promote innovation while managing downside risks. As an example, DPM Heng cited the importance of the common interest of the private sector and the government in getting rid of greenwashing.
“Singapore remains interested in working with blockchain and digital asset players. We are committed to partnering with innovative and responsible players to grow the Web3.0 ecosystem and community in Singapore,” she said.
“We will facilitate live experiments through regulatory sandboxes, including DeFi feasibility testing and asset tokenization. We hope to do pioneering work in these fields, in a way that benefits lives and our regions. We invite you to be a part of this journey as we strengthen the partnership between the regulator and the industry.”
Featured Image Credit: Reuters