- Singapore will introduce stricter rules regulating crypto service providers in the city-state to protect retail customers.
- “The consultation proposals detail business conduct and consumer access measures to limit potential consumer harm,” the Monetary Authority of Singapore said in a statement on Thursday.
- MAS has repeatedly warned that trading crypto is very risky and not suitable for the general public as crypto prices are subject to volatility and speculation.
A woman rides a bicycle in front of the Marina Bay Sands hotel and high-rise buildings in the background on September 4, 2023 in Singapore.
Roslan Rahman | AFP | Getty Images
Singapore will introduce stricter rules for cryptocurrency service providers after receiving feedback on the proposed regulations, the city-state’s financial regulator said.
“The consultation proposals detail business conduct and consumer access measures to limit potential consumer harm,” the Monetary Authority of Singapore said in a statement on Thursday.
The measures include banning crypto service providers in Singapore from accepting locally issued credit card payments, providing incentives for cryptocurrency trading, and offering funding, margin or leverage transactions to retail customers. The final measures will take effect gradually from mid-2024, MAS said.
The regulator will also issue business conduct rules, such as requiring crypto service providers to publish policies, procedures and criteria governing the listing of a digital payment token and to establish effective procedures for handling customer complaints and resolving disputes.
“DPT service providers are obliged to protect the interests of consumers who interact with their platforms and use their services,” said Ho Hern Shin, deputy managing director of financial supervision at MAS.
“While these business conduct and consumer access measures can help achieve this goal, they cannot protect customers from losses associated with the inherently speculative and high-risk nature of cryptocurrency trading,” Ho said.
“We urge consumers to remain vigilant and exercise extreme caution when trading on digital payment token services and not to do business with unregulated companies, including those based abroad.”
MAS has repeatedly warned that trading crypto is very risky and not suitable for the general public as crypto prices are subject to volatility and speculation.
Singapore’s Payment Services Act – a framework for regulating payment services and the provision of crypto services to the public – first came into effect in January 2020.
Singapore has since increased supervision of crypto firms. In July, it ordered companies to hold customer assets in a statutory trust before the end of the year. MAS also prevents companies from facilitating lending or pledging their retail customers’ assets.
In January 2022, Singapore banned crypto service providers from promoting their services in public areas or through third parties such as social media influencers. Crypto service providers can only market or promote their products on their own corporate websites, mobile applications or official social media accounts.
At the Singapore FinTech Festival 2023 last week, MAS chief executive Ravi Menon said cryptocurrencies “have failed the test of digital money.”
“They have performed poorly as a means of exchange or store of value. Prices are subject to strong speculative fluctuations. Many investors in these cryptocurrencies have suffered significant losses,” Menon said.