MAS Distances Itself From Unregulated Crypto Activities, Can It Continue Ruling the Roost?

The Monetary Authority of Singapore (MAS) Chairman said that not all crypto activities are regulated in response to parliament, as the country has faced some high-value crypto collapses in the last few months.

On a question posed by MP Yip Hon Weng around safeguards for the sector, MAS Incharge Tharman Shanmugaratnam stated, “In Singapore, as in other jurisdictions, not all activities related to digital payment tokens (DPT) — referred to as cryptocurrencies — are regulated.”

He further explained that while the Payment Services Act 2019 governs businesses that offer crypto services without interested parties applying for a license with the regulator, MAS would not be aware of the number of parties interested in establishing crypto investment firms in Singapore.

PS Act sets AML/CTF standards for crypto

Concerning money laundering and terrorism financing risks, the MAS chief said that the PS Act allows for a ‘rigorous licensing process.’ He said, “Many applicants have been turned away. Where MAS has reason to suspect that an applicant is involved in illicit activities, MAS will, besides rejecting the application, refer the matter to the Police for investigation.”

Singapore has been considered a favorable crypto market in Asia and globally and has arguably rescinded the crown to Dubai. Meanwhile, news of Terra’s collapse and founder Do Kwon’s subsequent departure from the country has got the state in the global purview of regulations. Previously, the watchdog reprimanded the defunct hedge fund Three Arrows Capital for putting out false and misleading information.

Many believe Singapore continues to be a leader

Despite being in the eye of the storm, Ripple’s Policy Director (APAC) Rahul Advani believes that the nation-state is a front-runner. He said, “The industry is moving at a breakneck speed. A lot of regulators are playing catch up. Singapore is ahead of the curve and, as a regulator, is open to discussions with the industry. You can sit in with the Monetary Authority of Singapore (MAS) and exchange views quite openly.”

That said, MAS has highlighted that it will find unlicensed businesses that illegally offer DPT services in Singapore and place them on its Investor Alert List. Shanmugaratnam added, “MAS also works closely with the Police to combat cryptocurrency scams. MAS and the Police have issued public advisories alerting consumers to guard against fraudulent websites soliciting cryptocurrency investments.”

It looks like Singapore will continue to allow setting crypto businesses with strict regulatory supervision while raising risk concerns for retail investors and deterring firms from advertising for them. But, how long can it maintain a good home for the businesses looking to set up shop in Singapore?