The Financial Regulatory Authority of Singapore is proposing lots of new laws to fight person speculation in cryptocurrencies and decrease investment hazards for consumers.
On the afternoon of November 23, 2023, the Monetary Authority of Singapore (MAS) announced various supplemental new laws to strengthen the management measures of digital currency payment solutions (DPT) with the aim of limiting the circumstance of lots of folks who they speculate in cryptocurrency.
Prominent between these is the regulation that prohibits cryptocurrency businesses from offering leveraged trading solutions, margins or loans for fiscal transactions. MAS hopes that the new principles will enable restrict likely injury from speculative actions and safeguard consumers from investment hazards.
MAS nowadays published measures on business enterprise perform and buyer accessibility to digital payment token solutions in Singapore to restrict likely harm to individuals. They will be implemented by way of laws and pointers, which will come into force in phases beginning from mid-2024. https://t.co/laevvAlW0a pic.twitter.com/kxBLRQG0az
—MAS (@MAS_sg) November 23, 2023
Second NotificationThe Financial Conduct Authority of Singapore has stated that cryptocurrency companies offering DPT solutions are not permitted to:
- Provide trading incentives to person traders – Because trading incentives can influence the valuation of tokens, resulting in people today to trade tokens with no thoroughly contemplating the linked hazards.
- Provide fiscal solutions (loans or loans), margin or leverage.
- Accept payments with locally issued credit score cards – Because credit score cards will make it simple for person buyers to dive into the “road of debt”.
Ms. Ho Hern Shin, deputy director standard of MAS, explained in the announcement
“We know that DPT services suppliers have an obligation to safeguard users’ rights, boost engagement on the platform and use of their solutions. While the over business enterprise practices and measures may possibly satisfy consumer attraction, they are not able to safeguard buyers from losses associated to the inherently speculative and large-chance nature of cryptocurrency trading.
We consequently urge consumers to be vigilant and training severe caution when dealing with DPT solutions and not to transact with unregulated entities, which include these primarily based overseas.”
The new measures and principles for managing MAS DPT solutions will be implemented by way of laws and pointers that will be utilized progressively in phases, beginning from mid-2024.
This is Singapore’s newest move in managing cryptocurrency transactions, coming quickly soon after MAS finished the legal framework for stablecoins in August 2023, applicable to stablecoins pegged to the Singapore dollar or any other G10 currency, which contains USD.
This regulatory framework has enabled primary stablecoin broker and issuer Paxos to situation USD-backed stablecoins in Singapore. Previously, Paxos also partnered with Binance to situation BUSD, but encountered lots of regulatory problems, so it had to discontinue this stablecoin brand.
The Monetary Authority of Singapore is also doing work with 17 big fiscal institutions this kind of as JP Morgan, Franklin Templeton, Standard Chartered, UBS Group AG, Citi Group, Ant Group… to take a look at even further initiatives for asset tokenization and jointly build platforms to increase industry tokenization. – This is element of the “Guardian” task strategy announced by MAS at the finish of October 2023.
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