Financial service regulator – Monetary Authority of Singapore has issued fresh guidelines to limit crypto trading by the public. It has also taken a firm stance and asked cryptocurrency companies to eschew advertising or showcasing their products to the general public. MAS substantiated their decision by stating reasons which were purely risk-oriented.
The guideline stated and clarified that Digital Payment Token service providers “should not portray the trading of DPTs cryptocurrencies in a manner that trivializes the high risks of trading in DPTs, and should not promote their DPT services in public areas in Singapore or through any other media directed at the general public in Singapore”.
“Highly Risky And Not Suitable For The General Public”
The Central Bank affirmed that such services are “highly risky and not suitable for the general public”. It implied that the broadcasting of cryptocurrency through traditional media such as newspapers and magazines must also cease to exist.
On Tuesday, MAS declared that it would be outlawing crypto-to-cash terminals, thus, sealing all crypto ATMs in Singapore. Daenerys & Co, which is one of the biggest crypto ATM operators with five crypto ATMs spread across the city had acted in accordance with the guidelines. Another rival ATM operator, Deodi also complied with the Central Bank’s order and ceased its only ATM.
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This recent regulatory clamp from the MAS cropped up amidst the growing popularity of the blockchain industry with new investors joining the ecosystem each day. Although MAS quoted that “MAS strongly encourages the development of blockchain technology and innovative application of crypto tokens in value-adding use cases.”; the cryptocurrency market in Singapore continues to reel under a significant number of regulatory milestones.
Recently, Coincub, a fintech start-up in one of their rankings, called Singapore the world’s most friendly cryptocurrency economy. Singapore in the past had been quite liberal in terms of cryptocurrency adoption with an undemanding and positive legislative environment. Currently, the reality looks quite different, so to say.
MAS believes that ATMs facilitated a seamless and convenient transaction of cryptocurrencies such as Bitcoin and Ethereum. This could cause people to trade “on impulse”. This notion caused regulators to mandate the clampdown of ATMs all across the city.
In regards to crypto regulations, Singapore isn’t the only name on the list. In December 2021, Britain outlawed advertisements from seven such crypto firms as they were “irresponsibly taking advantage of consumers’ inexperience and for failing to illustrate the risk of the investment”.
Spain had also led a crackdown on cryptocurrency promotions recently. Singapore’s regulatory escalation comes after Bitcoin’s prices nosedived almost 40% after BTC soared to new heights in November 2021.
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Cryptocurrency is not only a volatile asset but has also enabled a wide spectrum of fraud associated with digital assets. In recent times, cryptocurrency has facilitated money laundering and terrorism funding among other illegal activities.
“Digital payment token service providers in Singapore have to comply with requirements to mitigate such risks, including the need to carry out proper customer due diligence, conduct regular account reviews, and monitor and report suspicious transactions,” stated MAS spokesperson.
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