The Financial Authority of Singapore (MAS) on Wednesday revealed two session papers proposing regulatory frameworks to scale back traders’ danger in crypto buying and selling and assist stablecoins for transactions. The measures together with shopper entry, enterprise conduct, and expertise dangers are a part of the Fee Companies Act. The MAS bans retail traders from utilizing bank cards and borrowing funds for crypto buying and selling.
Singapore’s Central Financial institution Proposes Crypto Buying and selling, Stablecoins Measures
In a press release on October 26, The Financial Authority of Singapore introduced proposed measures to scale back crypto buying and selling dangers for retail traders. Furthermore, regulate the issuance of stablecoins pegged to a foreign money.
The MAS considers cryptocurrencies vital within the digital asset ecosystem and received’t ban them. Subsequently, the MAS requires crypto buying and selling suppliers comparable to crypto exchanges to make sure enterprise conduct and enough danger disclosure.
The crypto service suppliers should prohibit retail traders from utilizing bank cards and leverage for crypto buying and selling. Additionally, the service suppliers will deal with the segregation of shoppers’ belongings and mitigate shopper complaints. On the expertise dangers, the MAS needs corporations to keep up the excessive availability and recoverability of essential methods.
Moreover, the MAS will regulate stablecoins as a medium of change within the digital asset ecosystem. It goals to develop the regulatory framework for stablecoins to make sure a excessive diploma of worth stability. Furthermore, stablecoin issuers are required to publish a white paper with all particulars comparable to redemption rights.
Apparently, well-regulated and securely backed stablecoins might be most popular by the MAS. Additionally, banks can situation stablecoins with out extra reserve backing and prudential necessities. The final date for feedback on the proposals is December 21.
Ms Ho Hern Shin, Deputy Managing Director of the MAS, stated:
“The 2 units of proposed measures mark the following milestone in enhancing Singapore’s regulatory method to foster an progressive and accountable digital asset ecosystem.”
Singapore’s Strict Stance on Crypto
Whereas the MAS considers cryptocurrencies important for the digital asset ecosystem, the current crash of Singapore-based crypto corporations led to a strict stance on crypto. The proposed laws additionally stop staking and lending to generate yields.
The crash of crypto companies comparable to Three Arrows Capital, Terraform Labs, Zipmex, Vauld, and Hodlnaut brought about Singapore to introduce a stringent crypto regulatory framework. Not too long ago, Coinbase and Blockchain.com acquired licenses in Singapore.
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