Tharman Shanmugaratnam, the minister in charge of the central bank, told Parliament, that The Monetary Authority of Singapore (MAS) is considering additional consumer protection safeguards on crypto,.
Shanmugaratnam said in Parliament on Monday that MAS is considering to introduce rules on the use of leverage and limits on retail participation in crypto.
“Recent events have vividly demonstrated the risks, with prices of several cryptocurrencies falling drastically,” he said.
MAS is currently regulating Digital Payment Token (DPT) service providers under the Payment Services Act (PS Act), primarily related to money laundering and terrorism financing risks.
“But the PS Act also empowers MAS to impose additional measures on DPT service providers to ensure better consumer protection, and to maintain financial stability and safeguard the efficacy of monetary policy,” the minister said.
Singapore evaluates more crypto security measures after scandals
A series of high-profile crypto scandals, including firms based in the city-state and plunging digital-asset prices, has led Singapore to consider new rules to protect consumers.
Chairman Tharman Shanmugaratnam said in a written response to a question from parliament that the Monetary Authority of Singapore (MAS) “has been carefully considering the introduction of additional consumer protection safeguards”. “These may include placing limits on retail participation, and rules on the use of leverage when transacting in cryptocurrencies.”
The central bank has repeatedly warned this year that cryptocurrencies aren’t for retail investors, as a US$2 trillion (RM8.83 trillion) market selloff has affected a growing list of players.
Terraform Labs, whose TerraUSD stablecoin collapsed in May, is based in Singapore, which affected Three Arrows Capital. The crypto hedge fund was ordered into liquidation last month after failing to repay creditors.