The key proposed issuer requirements relate to – MAS will regulate the issuance of stablecoins which are pegged to a single currency (“SCS”) where the value of SCS in circulation exceeds S$5 million. The current regulatory framework, which primarily addresses money laundering and terrorism financing risks, and technology and cyber risks, will be expanded to ensure that regulated stablecoins have a high degree of value stability.Ħ. Stablecoins have the potential to be a medium of exchange to facilitate transactions in the digital asset ecosystem, provided they are well-regulated and securely backed. Regulations cannot protect consumers from losses arising from the inherently speculative and highly risky nature of DPT trading.ĥ. Notwithstanding these regulatory measures, consumers must continue to exercise utmost caution when trading in DPTs and must take responsibility for such trading. Similar to other financial institutions such as banks, DPT service providers will be required to maintain high availability and recoverability of their critical systems.Ĥ. DPT service providers will be required to implement proper segregation of customers’ assets, mitigate any potential conflicts of interest which arise from the multiple roles they perform, and establish processes for complaints handling. They must also disallow the use of credit facilities and leverage by retail consumers for cryptocurrency trading. DPT service providers will be required to provide relevant risk disclosures to enable retail consumers to make informed decisions regarding cryptocurrency trading. The proposed measures cover three broad areas – Therefore, to reduce the risk to consumers from speculative trading in cryptocurrencies, MAS will require that DPT service providers ensure proper business conduct and adequate risk disclosure.ģ. However, cryptocurrencies play a supporting role in the broader digital asset ecosystem, and it would not be feasible to ban them. Trading in cryptocurrencies (also known as digital payment tokens or DPTs) is highly risky and not suitable for the general public. These measures will be part of the Payment Services Act.Ģ. Singapore, 26 October 2022… The Monetary Authority of Singapore (MAS) today published two consultation papers proposing regulatory measures to reduce the risk of consumer harm from cryptocurrency trading and to support the development of stablecoins as a credible medium of exchange in the digital asset ecosystem.
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