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Central bank of Singapore imposing new guidelines limit cryptocurrency retail trading

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Indrani Bose Follow

INDIA

Jul, 08 2022

Jul, 08 2022

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In an effort to mitigate cryptocurrency risks, the Monetary Authority of Singapore (MAS) told Parliament that the central bank is seeking to issue additional guidelines that limit cryptocurrency retail trading service providers. This will shield retail investors from potential risks.  

Additional consumer protection safeguards have been carefully considered by MAS. A senior Minister in charge of MAS, Tharman Shanmugaratnam, answered a parliamentary question about the regulation of cryptocurrency on Monday and said in parliament that those rules could include placing limits on retail participation and the rules use of leverage when transacting done in cryptocurrencies.

The marketing and advertising of cryptocurrency services in public areas or media that address the public, such as newspapers, broadcasts, magazines, or through the engagement of third parties like social media platforms, were restricted by the central bank in January. Also, cryptocurrency trading was disallowed. Only marketing or advertising on their own corporate websites, mobile applications, or official social media accounts were permitted.

According to Shanmugaratnam, the MAS has consistently warned that cryptocurrencies are not suitable investments for retail investors since 2017. In mid-January, the MAS told crypto service providers not to promote their services in Singapore. The country's digital payment token (DPT) service providers have since then taken steps to comply with the central bank's rules, removing cryptocurrency ATMs from public places and removing advertisements from public transport.

About 180 applications have been received for DPT licenses, and out of which five have been approved in principle, sixty have withdrawn their applications and three have been rejected and other applications status not Disclosed by MAS.

In June, Sopnendu Mohanty, the central bank's chief fintech officer, said MAS plans about being brutal and relentingly hard on "bad behavior". In June. Crypto.com and two other crypto firms received in-principal licenses from Singapore.

A member of the Singapore Parliament, Murali Pillai, asked Shanmugaratnam whether the MAS planned to restrict cryptocurrency trading platforms to protect unsophisticated persons against highly risky trades.

Singapore has a relatively clear regulatory and operating environment, which makes it an attractive location for cryptocurrency companies. Singapore is among the forerunners in developing formal licensing frameworks worldwide. The price of most cryptocurrencies fluctuates sharply because of speculative speculation and several cryptocurrencies have fallen dramatically in recent days, demonstrating the risks. Over the past 24 hours, bitcoin (BTC-USD) is down 1% to $19.5K and Ethereum (ETH-USD) is down 1.4% to $1.09K.


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Indrani Bose

CBW - External Analyst

INDIA

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