Sign Up on MEXC
The Monetary Authority of Singapore (MAS) on Wednesday published two consultation papers proposing regulatory frameworks to reduce investors’ risk in crypto trading and support stablecoins for transactions. The measures including consumer access, business conduct, and technology risks are part of the Payment Services Act. The MAS bans retail investors from using credit cards and borrowing funds for crypto trading.
Singapore’s Central Bank Proposes Crypto Trading, Stablecoins Measures
In a press release on October 26, The Monetary Authority of Singapore announced proposed measures to reduce crypto trading risks for retail investors. Moreover, regulate the issuance of stablecoins pegged to a currency.
The MAS considers cryptocurrencies important in the digital asset ecosystem and won’t ban them. Therefore, the MAS requires crypto trading providers such as crypto exchanges to ensure business conduct and adequate risk disclosure.
The crypto service providers must prohibit retail investors from using credit cards and leverage for crypto trading. Also, the service providers will handle the segregation of customers’ assets and mitigate consumer complaints. On the technology risks, the MAS wants companies to maintain the high availability and recoverability of critical systems.
Furthermore, the MAS will regulate stablecoins as a medium of exchange in the digital asset ecosystem. It aims to expand the regulatory framework for stablecoins to ensure a high degree of value stability. Moreover, stablecoin issuers are required to publish a white paper with all details such as redemption rights.
Interestingly, well-regulated and securely backed stablecoins will be preferred by the MAS. Also, banks can issue stablecoins without additional reserve backing and prudential requirements. The last date for comments on the proposals is December 21.
Ms Ho Hern Shin, Deputy Managing Director of the MAS, said:
“The two sets of proposed measures mark the next milestone in enhancing Singapore’s regulatory approach to foster an innovative and responsible digital asset ecosystem.”
Singapore’s Strict Stance on Crypto
While the MAS considers cryptocurrencies essential for the digital asset ecosystem, the recent crash of Singapore-based crypto companies led to a strict stance on crypto. The proposed regulations also prevent staking and lending to generate yields.
The crash of crypto firms such as Three Arrows Capital, Terraform Labs, Zipmex, Vauld, and Hodlnaut caused Singapore to introduce a stringent crypto regulatory framework. Recently, Coinbase and Blockchain.com received licenses in Singapore.
- September 50 BPS Fed Rate Cut Odds Climb Ahead of CPI, PPI Data
- Michael Saylor Spotlights Strategy’s Performance Following S&P 500 Snub
- Donald Trump Shortlists Hassett, Warsh, and Waller for Fed Chair
- Ethena Labs Secures Fresh Funding From ArkStream Capital, ENA Price Spikes
- SEC Forms International Task Force to Crack Down on Pump-and-Dump Schemes
- Solana Price Prediction: Will Solana Hit $320 as SOL Strategies Gains Nasdaq Approval?
- XRP Price Forecast: Analyst Eyes $127 as BlackRock Joins Ripple Swell 2025
- Chainlink Price Eyes $55 as Reserve Holdings Jump With 43,937 LINK Addition
- Cardano Price Targets 30% Surge as Top Economist Calls for Fed Cut
- ETH Price Forecast as Grayscale’s Covered Call Ethereum ETF Spurs Optimism — Is $8,500 in Sight?
