Singapore’s MAS curbs speculation, introduces new crypto regulation

November 28, 2023

By Sharan Kaur Phillora

Singapore’s Monetary Authority (MAS) has taken a decisive step in regulating the crypto market by releasing the final tranche of regulations for Digital Payment Token (DPT) service providers. These regulations, which have been the subject of extensive consultation and feedback, aim to enhance business conduct, consumer access, and the management of technology and cyber risks within the crypto sphere​​​​​​.

Here’s what we know:

The new measures implemented by MAS are multifaceted. One significant aspect is the requirement for DPT service providers to safekeep customer assets under a statutory trust. This mandate, expected to be in place before the year’s end, emphasizes the authority’s commitment to protecting consumer interests and ensuring the safekeeping of their assets​​.

In an effort to mitigate the risks associated with cryptocurrency speculation, the MAS has introduced stringent rules targeted at retail crypto trading. These include barring credit card purchases and leveraging in crypto transactions. By implementing these rules, effective from mid-2024, MAS aims to curb speculative behavior in the crypto market, reducing overall market risk and protecting the interests of retail investors​​.

Additionally, the MAS regulations focus on the technological and cybersecurity aspects of crypto trading. Ensuring that DPT service providers adhere to minimum technology and cyber risk management requirements is crucial in an industry heavily reliant on digital technologies and prone to cyber threats. These measures not only align with the global trend towards tighter regulation of digital currencies but also seek to foster a secure and responsible environment for crypto trading​​.

These developments in Singapore’s regulatory landscape reflect a broader global trend towards the integration of digital currencies into the formal financial system while simultaneously addressing the risks associated with these new forms of assets. The MAS’s approach balances the need for innovation and growth in the crypto sector with the imperative of consumer protection and market stability.

As digital currencies continue to evolve, regulatory frameworks like Singapore’s will likely become more prevalent, shaping the future of cryptocurrency trading and investment on a global scale. The MAS’s initiative represents a proactive and considered response to the challenges and opportunities presented by the rapidly growing cryptocurrency market.

About the author

Sharan Kaur Phillora’s thirst for knowledge has led her to study many different subjects, including NFTs and Blockchain technology – two emerging technologies that will change how we interact with each other in the future. When she isn’t exploring a new idea or concept, she enjoys reading literary masterpieces.

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