MAS Consults on Regulatory Approach for Payment Token Derivatives
MAS published a consultation paper on its regulatory approach under the Securities and Futures Act (SFA) for derivatives contracts that reference payment tokens as underlying assets (Payment Token Derivatives). To reflect the intended regulatory scope of Payment Token Derivatives under the SFA (discussed in Section 3 of the consultation paper), MAS is proposing to amend the Securities and Futures (Prescribed Underlying Thing) Regulations 2018. Annex B contains the text for amendments being proposed under the SFA. The consultation closes on December 20, 2019.
MAS has received queries from industry participants about whether Payment Token Derivatives, like those referencing Bitcoin and Ether, fall within the regulatory scope of SFA. MAS has also received indications of interest for Payment Token Derivatives regulated under the SFA to be made available to investors in Singapore. In calibrating the regulatory response, MAS intends to adopt a balanced view that seeks to allow innovation to co-exist in a regulatory environment with high standards. The consultation paper sets out the views of MAS on the appropriate regulatory approach for Payment Token Derivatives under the SFA.
The trading of the most popular digital tokens has largely been on unregulated markets. There has been interest from international institutional investors for a regulated alternative that could mitigate some of the concerns. Such regulated alternatives have recently emerged. In particular, Bitcoin futures have been listed and are traded on the U.S. futures exchanges. A well-regulated market for derivatives—particularly one anchored by institutional investors with sophisticated risk management and investment strategies—can serve as a more reliable reference of value for the underlying asset.
Comment Due Date: December 20, 2019
Keywords: Asia Pacific, Singapore, Banking, Securities, Payment Token Derivatives, SFA, Securities and Futures Regulation, Derivatives, MAS
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Patrycja Oleksza
Applies proficiency and knowledge to regulatory capital and reporting analysis and coordinates business and product strategies in the banking technology area
Previous Article
DNB Responds to the Court of Audit Report on Resolution of BanksRelated Articles
EBA Publishes Final Regulatory Standards on STS Securitizations
The European Banking Authority (EBA) published the final draft regulatory technical standards specifying and, where relevant, calibrating the minimum performance-related triggers for simple.
ECB Further Reviews Costs and Benefits Associated with IReF
The European Central Bank (ECB) is undertaking the integrated reporting framework (IReF) project to integrate statistical requirements for banks into a standardized reporting framework that would be applicable across the euro area and adopted by authorities in other EU member states.
EBA Publishes Funding Plans Report, Receives EMAS Certification
The European Banking Authority (EBA) has been awarded the top European Standard for its environmental performance under the European Eco-Management and Audit Scheme (EMAS).
MAS Launches SaaS Solution to Simplify Listed Entity ESG Disclosures
The Monetary Authority of Singapore (MAS) set out the Financial Services Industry Transformation Map 2025 and, in collaboration with the SGX Group, launched ESGenome.
BCBS to Finalize Crypto Rules by End-2022; US to Propose Basel 3 Rules
The Basel Committee on Banking Supervision met, shortly after a gathering of the Group of Central Bank Governors and Heads of Supervision (GHOS), the oversight body of BCBS.
IOSCO Welcomes Work on Sustainability-Related Corporate Reporting
The International Organization of Securities Commissions (IOSCO) welcomed the work of the international audit and assurance standard setters—the International Auditing and Assurance Standards Board (IAASB)
BoE Allows One-Day Delay in Statistical Data Submissions by Banks
The Bank of England (BoE) published a Statistical Notice (2022/18), which informs that due to the Bank Holiday granted for Her Majesty Queen Elizabeth II’s State Funeral on Monday September 19, 2022.
ACPR Amends Reporting Module Timelines Under EBA Framework 3.2
The French Prudential Control and Resolution Authority (ACPR) announced that the European Banking Authority (EBA) has updated its filing rules and the implementation dates for certain modules of the EBA reporting framework 3.2.
ECB Paper Discusses Disclosure of Climate Risks by Credit Agencies
The European Central Bank (ECB) published a paper that examines how credit rating agencies accepted by the Eurosystem, as part of the Eurosystem Credit Assessment Framework (ECAF)
APRA to Modernize Prudential Architecture, Reduces Liquidity Facility
The Australian Prudential Regulation Authority (APRA) announced reduction in the aggregate Committed Liquidity Facility (CLF) for authorized deposit-taking entities to ~USD 33 billion on September 01, 2022.
