Don’t trade in Singapore’s Crypto Hub ambitions
In the latest sign that Singapore is looking to shake off its reputation as a regulatory haven for the crypto industry, Monetary Authority of Singapore (MAS) CEO Ravi Menon said he was more interested in protecting investors than attracting them crypto firms with slack. rules.
“We have to do what is right for us, what is necessary to limit the risk. And the risk is primarily damage to retail investors,” he said in an interview published on Bloomberg TV on Friday (October 28).
See more: Singapore moves to protect retail crypto traders from itself
He said that while Singapore still has ambitions to be a crypto hub, the focus was on promoting innovation in tokenization of real assets and other application uses. He has little interest in it becoming a center for cryptocurrency trading, which he said is “not part of the vision.”
Earlier this week, MAS published two consultation documents with proposals for the regulation of stablecoins and businesses that offer digital token-based payment services.
Among the proposals, MAS proposes to define a new regulated activity of “Stablecoin Issuance Service.” If imposed, the rule would mean that new issuers would have to be granted a licence. Banks will also be able to issue stablecoins under this regime which sets out the terms on which they can do so.
The regulator also proposed strict restrictions on the use of credit to pay for cryptocurrency.
MAS said that Digital Payment Token (DPT) prices are highly volatile and subject to sharp price swings, and that “the use of any form of credit or leverage in trading DPTs will lead to magnified losses and may cause the customer to lose more than the full amount and more.”
MAS therefore proposes that cryptocurrency exchanges should not be able to offer lines of credit, accept payment by credit card or enter into transactions with collateral. Should these rules be imposed, they would represent one of the harshest positions on crypto trading by any regulator.
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