Singapore distances itself from local crypto companies • The Register

The Monetary Authority of Singapore (MAS) said on Tuesday that its cryptocurrency regulations will add measures to protect consumers, in addition to ongoing efforts to curb money laundering and terrorist financing.

“Most regulatory regimes today do not cover areas such as consumer protection, market conduct and reserve support for stablecoins. This is changing,” MAS CEO Ravi Menon said at a media conference.

Menon detailed that reviews and public hearings on the matter have begun among international standards bodies, and that MAS aims to consult on proposed measures over the next few months. Menon also reminded the audience of Singapore’s stance on crypto for consumers: just don’t take the risk.

Singapore has repeatedly warned retail investors to avoid cryptocurrency as it increased regulations on operators through licensing requirements and restrictions on advertising.

Singapore’s anti-crypto rhetoric has increased in recent weeks, after Terraform Labs’ ‘UST’ stablecoin collapsed and helped trigger market uncertainty that has sent the price of many cryptoassets plummeting.

Terraform Labs is incorporated in Singapore. Other recently fallen crypto firms, Vauld and Three Arrows Capital, are headquartered in the city-state.

Speaking of events to come, MAS board member Alvin Tan warned in Parliament in April that while Singapore has long benefited from its reputation as offering a notoriously frictionless business environment, crypto players who call the island nation home create “reputational risk” around the world.

In his speech, Menon distanced MAS from the fallen companies. “Some crypto players that have come under pressure have been reported by the media as ‘Singapore-based’,” Menon said. “In reality, these so-called ‘Singapore-based’ crypto firms have little to do with crypto-related regulation in Singapore.”

The MAS representative cited Terraform Labs and associated reserve-holding nonprofit Luna Foundation Guard as not regulated by the body, having never sought or sought exemption from a license from MAS.

Menon also clarified that Three Arrows Capital was not regulated under the Payment Services Act. Instead, it had been operating under the registered fund management regime to conduct limited fund management activities, but ceased managing funds in Singapore before it became insolvent.

Crypto lending company Vauld also did not have a crypto trading license in Singapore, but had an application currently under review by MAS.

But despite being anti-retail crypto, the representative of the regulatory body reiterated that Singapore was striving to become an “innovative and responsible digital asset hub”, and organized seminars next month to explain its position on cryptocurrency, stablecoins, blockchains, tokenization, smart contracts and digital assets.

Menon also revealed that fintech investment reached an all time high of $3.9 billion in 2021 and a total of 4,300 net jobs were created in financial services and fintech.

However, this growth has slowed thanks to global inflation in H12022.

“The externally oriented sectors such as manufacturing and financial services face some headwinds in light of weaker growth prospects in the global economy,” Menon warned. ®