Final rules seek to strike balance for crypto players
SINGAPORE: The final measures governing the cryptocurrency sector here sought to balance the need for retail-investor safeguards with companies’ worries, market observers say, noting that even as the regulator stood firm on certain aspects, it made adjustments too.
The comments come after the Monetary Authority of Singapore (MAS) on Nov 23 unveiled the last tranche of finalised crypto rules for digital payment token (DPT) service providers in Singapore.
The measures, to be rolled out in phases from mid-2024, prohibit DPT service providers from offering credit facilities to retail investors to buy or hold crypto, among others.
Angela Ang, senior policy adviser for blockchain intelligence firm TRM Labs in Singapore, said MAS had held its ground on some unpopular measures like not allowing Singapore credit card payments by local retail investors, while giving more latitude in other areas such as the treatment of crypto holdings in calculating the accredited investor threshold.
An accredited investor is someone with at least S$2mil in net personal assets.
Under the rules, MAS will recognise no more than 50% of the value of DPT holdings a person has, or up to S$200,000, whichever is lower, when determining if an individual is eligible as an accredited investor. Previously, DPT holdings were not recognised.
Lasanka Perera, chief executive of exchange Independent Reserve Singapore, said the inclusion of DPTs in determining an investor’s net worth as an accredited investor will have a positive impact on the traditional finance markets governed under the Securities and Futures Act.
He said the move will pave the way for DPTs to be progressively integrated into traditional financial systems, and in turn, encourage a wider adoption of digital assets.
While market players generally supported the moves, concerns that the rules could make players here less competitive than those overseas lingered.
Gerry Eng, chief technology officer at exchange Coinhako, said the new measures should ultimately reduce excessive cryptocurrency speculation by retail customers.
But he said it is vital to ensure that customers who wish to access DPT services are not impeded.
“To that extent, we think some of the measures being put in place could be refined to ensure that licensed and regulated entities based in Singapore could remain competitive on a global scale.”
Singapore Fintech Association president Shadab Taiyabi said the rules will give consumers and businesses greater clarity.
He said the digital assets economy has a global impact and the association remains steadfast in reinforcing Singapore’s position as a competitive and sustainable market. — The Straits Times/ANN
