1/26/2024 0 Comments Crypto exchange ratesFor non-issuance services, DPT service providers can offer all types of stablecoins provided that they clearly label the MAS-regulated SCS to distinguish them from the unregulated ones. Banks in Singapore will be allowed to issue SCS as well, and no additional reserve backing and prudential requirements will apply when the SCS is issued as a tokenised form of bank liabilities given the existing rigorous capital and liquidity frameworks applied to banks. They are also required to hold liquid assets which are valued at higher of 50% of annual operating expenses or an amount assessed by the SCS issuer to be needed to achieve recovery or an orderly wind-down.ħ. SCS issuers must, at all times, meet a base capital requirement of the higher of S$1 million or 50% of annual operating expenses of the SCS issuer. Stablecoin issuers will be required to publish a white paper disclosing details of the SCS, including the redemption rights of stablecoin holders. The G10 currencies are the Australian Dollar, British Pound Sterling, Canadian Dollar, Euro, Japanese Yen, New Zealand Dollar, Norwegian Krone, Swedish Krona, Swiss Franc and the United States Dollar. All SCS issued in Singapore can be pegged only to the Singapore dollar or any Group of Ten (G10) currencies. Requirements on audit and segregation of reserves, and timely redemption at par value will also apply. that are at least equivalent to 100% of the par value of the outstanding SCS in circulation, and these assets must be denominated in the same currency as the pegged currency. SCS issuers must hold reserve assets in cash, cash equivalents or short-dated sovereign debt securities This refers to debt securities with no more than three months residual maturity and are issued by (i) the central bank of the pegged currency or (ii) organisations that are of both a governmental and international character with a credit rating of at least “AA–". The key proposed issuer requirements relate to – MAS will regulate the issuance of stablecoins which are pegged to a single currency (“SCS”) where the value of SCS in circulation exceeds S$5 million. The current regulatory framework, which primarily addresses money laundering and terrorism financing risks, and technology and cyber risks, will be expanded to ensure that regulated stablecoins have a high degree of value stability.Ħ. Stablecoins have the potential to be a medium of exchange to facilitate transactions in the digital asset ecosystem, provided they are well-regulated and securely backed. Regulations cannot protect consumers from losses arising from the inherently speculative and highly risky nature of DPT trading.ĥ. Notwithstanding these regulatory measures, consumers must continue to exercise utmost caution when trading in DPTs and must take responsibility for such trading. Similar to other financial institutions such as banks, DPT service providers will be required to maintain high availability and recoverability of their critical systems.Ĥ. DPT service providers will be required to implement proper segregation of customers’ assets, mitigate any potential conflicts of interest which arise from the multiple roles they perform, and establish processes for complaints handling. They must also disallow the use of credit facilities and leverage by retail consumers for cryptocurrency trading. DPT service providers will be required to provide relevant risk disclosures to enable retail consumers to make informed decisions regarding cryptocurrency trading. The proposed measures cover three broad areas – Therefore, to reduce the risk to consumers from speculative trading in cryptocurrencies, MAS will require that DPT service providers ensure proper business conduct and adequate risk disclosure.ģ. However, cryptocurrencies play a supporting role in the broader digital asset ecosystem, and it would not be feasible to ban them. Trading in cryptocurrencies (also known as digital payment tokens or DPTs) is highly risky and not suitable for the general public. These measures will be part of the Payment Services Act.Ģ. Singapore, 26 October 2022… The Monetary Authority of Singapore (MAS) today published two consultation papers proposing regulatory measures to reduce the risk of consumer harm from cryptocurrency trading and to support the development of stablecoins as a credible medium of exchange in the digital asset ecosystem.
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