Featured Product

    Ravi Menon of MAS on the Evolving Regulatory Approach on Crypto Assets

    March 15, 2018

    Ravi Menon of MAS spoke at the Money20/20 Conference in Singapore about the current state of thinking on crypto assets (or crypto tokens), along with the evolving regulatory approach of Singapore. Mr. Menon added that MAS has, to-date, chosen not to regulate crypto tokens directly. However, it is focusing on the activities associated with crypto tokens, evaluating the different kinds of risks these activities pose, and considering the appropriate regulatory responses.

    Mr. Menon highlighted that the key risks that MAS is monitoring in the crypto world are in the areas of financial stability, money laundering, investor protection, and market functioning:

    • Financial stability. MAS and other regulators are studying the nexus between the crypto world and the financial system to assess how risks to financial stability may be transmitted. MAS assesses that the nature and scale of crypto token activities in Singapore do not currently pose a significant risk to financial stability. However, this situation could change; thus, MAS is closely watching this space. 
    • Money laundering. A clear and present danger posed by some crypto token activity is money laundering and terrorism financing. Intermediaries dealing in crypto tokens are already required to report any suspicious transactions to the Commercial Affairs Department. In addition, the proposed Payment Services Bill will require intermediaries that buy, sell, or exchange virtual currencies to specifically address money laundering and terrorism financing risks. Intermediaries will be required to conduct customer due diligence and establish controls and processes that are commensurate with their risks.
    • Investor protection. Where crypto tokens represent ownership or a security interest over an issuer's assets or any property, or a debt owed by the issuer, they may be regarded as securities under the Securities and Futures Act. This means that, unless exempted, issuers must comply with prospectus requirements prior to the offer of such tokens; intermediaries dealing in such tokens must meet licensing requirements; and platforms facilitating secondary trading of tokens must be approved or recognized by MAS. MAS has advised the public to act with extreme caution, should they wish to invest in crypto tokens.
    • Market functioning. Several cryptocurrency exchanges abroad have suffered cyber attacks and theft of their crypto tokens, along with reports of rampant market manipulation and other fraudulent activities on crypto-exchanges. "We are watching with interest developments in the US, where futures contracts based on crypto tokens have been introduced on regulated exchanges," said Mr. Menon. These exchanges have clear rules governing trade and post-trade activities. Such products could also potentially have a stabilizing influence on crypto token prices. However, regulation cannot address all the concerns around crypto tokens. The industry too has a part to play in strengthening the ecosystem—for instance, by adopting best practices around transparency, cybersecurity, and recordkeeping.

     

    Related Link: Speech

    Keywords: Asia Pacific, Singapore, Banking, Crypto-Assets, Fintech, Regtech, Financial Stability, MAS, BIS

    Related Articles
    News

    BCBS Amends Guidelines on Sound Management of AML/CFT Risks

    BCBS amended the guidelines on sound management of risks related to money laundering and financing of terrorism (ML/FT).

    July 02, 2020 WebPage Regulatory News
    News

    US Agencies Finalize Amendments to Swap Margin Rule

    US Agencies (Farm Credit Administration, FDIC, FED, FHFA, and OCC) finalized changes to the swap margin rule to facilitate implementation of prudent risk management strategies at banks and other entities with significant swap activities.

    July 01, 2020 WebPage Regulatory News
    News

    PRA Letter Sets Expectations on Approach to Managing Climate Risks

    PRA published a letter that builds on the expectations set out in the supervisory statement (SS3/19) on enhancing banks' and insurers' approaches to managing the financial risks from climate change.

    July 01, 2020 WebPage Regulatory News
    News

    EBA Guidelines on Treatment of Structural Foreign Exchange Under CRR

    EBA finalized the guidelines on treatment of structural foreign-exchange (FX) positions under Article 352(2) of the Capital Requirements Regulation (CRR).

    July 01, 2020 WebPage Regulatory News
    News

    FSB Issues Statement on Impact of COVID-19 Crisis on Benchmark Reform

    FSB published a statement on the impact of COVID-19 pandemic on global benchmark transition.

    July 01, 2020 WebPage Regulatory News
    News

    IAIS Publishes List of Internationally Active Insurance Groups

    IAIS published the list of Internationally Active Insurance Groups (IAIGs) publicly disclosed by group-wide supervisors.

    July 01, 2020 WebPage Regulatory News
    News

    FED Temporarily Revises FR Y-9C With Respect to PPPLF and CARES Act

    FED has temporarily revised the reporting form on consolidated financial statements for holding companies (FR Y-9C; OMB No. 7100-0128).

    July 01, 2020 WebPage Regulatory News
    News

    EC Launches Consultation on Review of Solvency II Directive

    EC launched a consultation on the review of the key elements of Solvency II Directive, with the comment period ending on October 21, 2020.

    July 01, 2020 WebPage Regulatory News
    News

    ECB Consults on Supervisory Approach to Consolidation in Banking

    ECB launched a consultation on the guide that sets out supervisory approach to consolidation projects in the banking sector.

    July 01, 2020 WebPage Regulatory News
    News

    IAIS on Package for 2020 Data Collection on ICS and Aggregation Method

    IAIS published technical specifications, questionnaires, and templates for 2020 Insurance Capital Standard (ICS) and Aggregation Method data collections.

    June 30, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5425