Singapore will widen crypto regulation and discuss possible steps later this year
Singapore is set to expand the scope of its crypto regulations and will consult on proposed measures this year following a drastic crash in the crypto industry.
The Monetary Authority of Singapore said most crypto regulation both in Singapore and internationally focuses on tackling money laundering and terrorist financing risks, but this will expand.
“Most regulatory regimes today do not cover areas such as consumer protection, market conduct, and reserve backing for stablecoins. This is changing,” the central bank’s Managing Director Ravi Menon said today following the release of its annual report. “Reviews and public consultations are underway, among international standard-setting bodies and regulators, to strengthen regulation in these areas.”
“MAS is targeting to consult on proposed measures in the next few months.”
Menon reiterated the central bank’s views on crypto, saying that the main lesson from the global crypto crash is that investing in cryptocurrencies is “highly risky.” Crypto suffered a sharp crash this year that caused prices of major cryptocurrencies to plunge and led to crypto firms collapsing.
MAS has repeatedly warned against retail investing in crypto and has taken a tough stance on it, previously saying that “retail investors should not be dabbling in cryptocurrencies.”
Menon criticised Singapore-based crypto firms that have been front and centre in the crash and said they tend to not be regulated. He called out TerraForm Labs, whose TerraUSD stablecoin and luna cryptocurrency collapsed earlier this year and helped trigger a severe crypto selloff, for not being licensed or regulated by MAS.
Regarding Singapore-based Three Arrows Capital, the collapsed crypto hedge fund, Menon said it was not regulated under the Payment Services Act.
“MAS and relevant government agencies will take firm enforcement action if any entity is found to be conducting illegal activities or performing regulated activities without a licence,” Menon said. “The crypto industry globally is still evolving and regulation is still catching up with industry trends.”