The Monetary Authority of Singapore is seeking new limitations to tighten crypto speculation.
Singapore’s financial watchdog, the Monetary Authority of Singapore, is set to impose new rules on retail cryptocurrency investors in a bid to protect customers from highly speculative assets.
In a statement released on Thursday, November 23, MAS proposed new regulatory measures aimed at preventing crypto companies from offering incentives to retail customers, saying that incentives such as free tokens upon registration “may unduly prejudice retail customers’ judgment” to use encryption services. .
The regulator admitted that the majority of respondents to its consultation paper on the new rules did not agree with the restriction. MSA, in turn, said that such inventions may entice people to trade tokens “without fully considering the risks involved.”
As such, firms will not be able to offer incentives or margin/leverage transactions for their clients, MAS also ruled. Additionally, Singapore’s financial regulator also banned crypto companies from accepting locally issued credit cards, arguing that the credit cards would allow retail customers “easy access to debt financing.” The new regulatory framework is expected to be implemented gradually starting in mid-2024.
Singapore’s latest efforts to regulate cryptocurrency trading come shortly after MAS unveiled new rules targeting issuers of stablecoins pegged to the Singapore dollar or any G10 currency. That framework covers requirements related to stablecoin stability, capital, par repayment, and disclosure of audit results to clients.
The regulator also emphasized that only stablecoin issuers that meet all specified criteria can apply for designation as “MAS-regulated stablecoins.”
