Afrigather Singapore authorities have proposed a brand new set of regulatory measures to supervise using digital belongings within the nation and shield customers.
The nation’s central financial institution and monetary regulator, the Financial Authority of Singapore (MAS), not too long ago printed two session papers containing recommendations to tighten the nation’s regulatory stance on digital belongings.
MAS Proposes Ban on Crypto Credit score
One of many proposals outlined within the consultation paper is to ban retail traders from utilizing bank cards or different credit score services to borrow funds for buying or buying and selling cryptocurrencies.
The MAS additionally proposed that crypto traders bear an evaluation requiring them to reply a questionnaire to confirm whether or not they perceive the potential dangers related to crypto investments.
These restrictions, nevertheless, don’t apply to high-net-worth traders who qualify for a broader vary of investments. The paper proposed a cap of S$200,000 (roughly $142,000) on digital asset investments for accredited traders.
Because of the risky nature of cryptocurrencies, the MAS has moved to ban crypto firms from providing such loans, staking, and leveraged transactions. Based on the central financial institution, the instability of costs could cause customers to incur huge losses.
Moreover, the monetary regulator identified that crypto service suppliers ought to segregate clients’ belongings and mitigate shopper complaints by having strong threat disclosures.
“The latest failure of a number of corporations within the DPT trade underscores the significance of DPTSPs having efficient and strong preparations in place for the identification and segregation of shoppers’ belongings,” the paper reads.
Stablecoins Regulation in Singapore
In a separate consultation paper, the MAS disclosed its plans to control the issuance of stablecoins pegged to a single foreign money (SCS) the place the worth of the tokens in circulation exceeds S$5 million ($3.6 million).
The paper famous that stablecoins should be pegged to the Singapore greenback or a Group of 10 foreign money and be absolutely backed by reserve belongings of the identical denomination. Moreover, stablecoin issuers should publish a white paper disclosing all essential particulars, such because the redemption rights of holders.
No Outright Ban
The proposals come just a few months after the nation was hit by a collection of crypto insolvencies that stemmed from the TerraUSD collapse in Might.
In August, the MAS announced that it intends to determine a stricter regulatory framework to supply crypto traders most safety amid the risky market.
Nevertheless, the nation’s central financial institution clarified that it presently has no plans of putting an outright ban on cryptocurrency companies for retail customers to stop them from searching for such companies on unlicensed platforms.
The session interval begins as we speak and ends on December 21, throughout which the regulatory physique goals to assemble feedback from stakeholders relating to the rules.
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