Monetary Authority of Singapore Issues New Guidelines for Crypto Companies

The Monetary Authority of Singapore (MAS) is looking to protect retail investors from the potential risks of cryptocurrency after it released new guidelines limiting trading service providers from marketing their services to the public on Monday. The guidelines are set to take effect immediately.

Singapore’s clear regulatory and operating environment has attracted a lot of cryptocurrency companies, making it a frontrunner in developing a formal licensing framework for emerging technology. Despite this, its authorities have warned that the trading of digital payment tokens (DPT) is a highly risky venture and unsuitable for the general public. Hence, the regulation comes at a significant point just as cryptocurrency has started to gain traction.

Under the new guidelines, crypto companies are only allowed to advertise their services on their own websites, mobile applications, and official social media accounts instead of marketing in public areas such as on public transport as well as broadcast and print media. Crypto companies are also unauthorized to tap third parties like influencers. However, penalties for non-compliance have not been defined.

“MAS strongly encourages the development of blockchain technology and innovative application of crypto tokens in value-adding use cases,” explained MAS Assistant Managing Director for Policy, Payments, and Financial Crime Loo Siew Yee. “But the trading of cryptocurrencies is highly risky and not suitable for the general public. DPT service providers should therefore not portray the trading of DPTs in a manner that trivializes the high risks of trading in DPTs, nor engage in marketing activities that target the general public.”

So far, around 180 applications have been submitted to MAS for licenses to provide DPT services. Out of the total pool, only 5 have been awarded in-principle approvals while 60 applications have either been rejected or withdrawn. The remaining applicants are still up in the air, and MAS did not disclose their statuses.

Sources: Reuters, The Straits Times