- The purpose of Project Guardian is to assess the suitability and potential use of digital technology
- It has four areas
On June 26, the Japan Financial Services Authority (FSA) announced a collaboration with the Monetary Authority of Singapore (MAS) to jointly regulate and pilot test crypto projects under the “Project Guardian” initiative.. At this stage, FSA participation will be limited to an observer function. The two regulators issued a joint statement:
“The purpose of the project is to conduct pilot experiments to test the compliance and suitability of digital technologies such as asset tokenization.”
And FSA spokesperson Mamoru Yanase said that “the decentralized financial ecosystem continues to grow more complex, and it is important to address the emerging risks.”
The Guardian project, launched by MAS in May 2022, aims to assess the “suitability of the use of asset tokenization and DeFi protocols” under regulatory requirements. It includes four key areas: developing open and interoperable networks, using trust anchors, asset tokenization, and institutional-level DeFi protocols.
Guardian is another example of collaboration between the FSA and MAS, but not the first. In 2017, the two regulators created a fintech collaboration program to promote innovation in their markets.