Singapore’s MAS curbs speculation, introduces new crypto regulation

The Monetary Authority of Singapore (MAS) has taken a step in shaping the future of cryptocurrency within its borders, introducing a set of regulations aimed at safeguarding consumers.

In response to the growing influence of cryptocurrencies, MAS has released the final tranche of regulations for Digital Payment Token (DPT) service providers, addressing concerns related to business conduct, consumer access, and technology and cyber risk management.

MAS has outlined specific measures to guide DPT service providers in conducting business responsibly. These include identifying and mitigating conflicts of interest, establishing transparent criteria for DPT listings, and implementing effective procedures for addressing customer complaints and disputes. The move reflects a commitment to ethical business practices within the crypto sphere.

To mitigate the risks associated with cryptocurrency speculation, MAS mandates DPT service providers to assess a customer’s risk awareness, refrain from offering incentives for trading, avoid financing or leveraging transactions, reject locally issued credit card payments, and limit the impact of cryptocurrency values on a customer’s net worth.

These measures aim to foster a cautious approach to crypto investments, aligning with the inherently speculative nature of the market.

Recognizing the critical role technology plays in the crypto landscape, MAS emphasizes the need for DPT service providers to maintain the high availability and recoverability of their systems. These requirements align with existing standards for financial institutions, ensuring robust cybersecurity practices in an increasingly digitized financial environment.

MAS plans to implement these regulations and guidelines gradually, starting in mid-2024. This phased approach allows DPT service providers sufficient time to adapt to the new framework and integrate these measures into their operations responsibly.

Ms Ho Hern Shin, Deputy Managing Director (Financial Supervision) at MAS, urges caution among crypto enthusiasts. While the regulations aim to protect consumers, she emphasizes the inherent risks associated with cryptocurrency trading. Her call for vigilance and avoidance of unregulated entities echoes the need for re

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Author: Ogwu Osaemezu Emmanuel

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