Singapore evaluates more crypto safeguards after blowups


Singapore is contemplating new guidelines to guard customers after plunging digital-asset costs triggered a collection of high-profile crypto blowups, together with corporations primarily based within the city-state.

The Monetary Authority of Singapore (MAS) “has been carefully considering the introduction of additional consumer protection safeguards”, its chairman Tharman Shanmugaratnam mentioned in a written response to a query from parliament. “These may include placing limits on retail participation, and rules on the use of leverage when transacting in cryptocurrencies.”

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The central financial institution has repeatedly mentioned this yr that cryptocurrencies aren’t for retail traders, as a US$2 trillion (RM8.83 trillion) market selloff engulfed a rising listing of gamers.

Terraform Labs, whose TerraUSD stablecoin imploded in May, relies in Singapore, as was Three Arrows Capital, the crypto hedge fund ordered into liquidation final month after failing to repay collectors.

ALSO READ: A crypto first? What happens when a blockchain like Terra dies

Frozen withdrawals

Vauld, a Singapore-based crypto lender, on July 4 mentioned it froze withdrawals and employed advisers to pursue a possible restructuring after a surge in withdrawals sapped liquidity.

The MAS final week reprimanded Three Arrows for offering false data and exceeding the restrict on property beneath administration. It’s persevering with to analyze the fund for more rule breaches.

Authorities within the city-state have lengthy maintained a cautious embrace of crypto, granting simply 14 corporations the regulatory nod to supply digital token cost providers domestically, a fraction of just about 200 candidates.

Fine line

Singapore has clamped down on crypto advertising and marketing and requires digital asset suppliers to be licensed domestically even when they solely do enterprise abroad.

The MAS’s chief fintech officer Sopnendu Mohanty lately mentioned the regulator is “brutal and unrelentingly hard” on any dangerous behaviour within the crypto market.

But he has additionally recommended main gamers within the trade like Binance and for efforts to create a accountable and compliant trade.

Governments internationally are growing their scrutiny of the trade amid a significant meltdown in crypto markets.

Bitcoin, the biggest digital token, has plunged about 56% this yr, a part of a broader retreat in riskier investments as tightening financial coverage drains liquidity from markets. It was buying and selling at about US$20,200 (RM89,231) as of 11.08am on July 5 in Singapore. – Bloomberg

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