Singapore evaluates more crypto safeguards after blowups


The Monetary Authority of Singapore ‘has been carefully considering the introduction of additional consumer protection safeguards’, its chairman Tharman Shanmugaratnam said. — Reuters

Singapore is considering new rules to protect consumers after plunging digital-asset prices triggered a series of high-profile crypto blowups, including firms based in the city-state.

The Monetary Authority of Singapore (MAS) “has been carefully considering the introduction of additional consumer protection safeguards”, its chairman Tharman Shanmugaratnam said in a written response to a question from parliament. “These may include placing limits on retail participation, and rules on the use of leverage when transacting in cryptocurrencies.”

ALSO READ: A US$2 trillion free-fall rattles crypto to the core

The central bank has repeatedly said this year that cryptocurrencies aren’t for retail investors, as a US$2 trillion (RM8.83 trillion) market selloff engulfed a growing list of players.

Terraform Labs, whose TerraUSD stablecoin imploded in May, is based in Singapore, as was Three Arrows Capital, the crypto hedge fund ordered into liquidation last month after failing to repay creditors.

ALSO READ: A crypto first? What happens when a blockchain like Terra dies

Frozen withdrawals

Vauld, a Singapore-based crypto lender, on July 4 said it froze withdrawals and hired advisers to pursue a potential restructuring after a surge in withdrawals sapped liquidity.

The MAS last week reprimanded Three Arrows for providing false information and exceeding the limit on assets under management. It’s continuing to investigate the fund for more rule breaches.

Authorities in the city-state have long maintained a wary embrace of crypto, granting just 14 firms the regulatory nod to provide digital token payment services locally, a fraction of almost 200 applicants.

Fine line

Singapore has clamped down on crypto marketing and requires virtual asset providers to be licensed locally even if they only do business overseas.

The MAS’s chief fintech officer Sopnendu Mohanty recently said the regulator is “brutal and unrelentingly hard” on any bad behaviour in the crypto market.

But he has also commended major players in the industry like Binance and Crypto.com for efforts to create a responsible and compliant industry.

Governments across the world are increasing their scrutiny of the industry amid a major meltdown in crypto markets.

Bitcoin, the largest virtual token, has plunged about 56% this year, part of a broader retreat in riskier investments as tightening monetary policy drains liquidity from markets. It was trading at about US$20,200 (RM89,231) as of 11.08am on July 5 in Singapore. – Bloomberg

Article type: free
User access status:
Subscribe now to our Premium Plan for an ad-free and unlimited reading experience!
   

Next In Tech News

Microsoft asks staff to curb expenses
Opinion: It’s alarming when TV shows and movies vanish off streaming services, but there’s a long history of this
Study: Consumers are likely to be susceptible to slick graphic design of trading platforms
US doctor pleads guilty to federal charges tied to dark web, kidnapping plot
Amazon moves to block website it says sells fake five-star feedback
In your office communications, watch your use of emojis
How to get your smartphone ready for a holiday
Snapchat introduces Family Centre tool to boost child safety
Try a free online tool to perfect your touch typing technique
Apps turning restaurant leftovers into cheap meals take off in Asia

Others Also Read