Singapore eyes more regulation to protect retail investors from crypto winter fallout News ▸ Singapore ▸ Regulation
Singapore eyes more regulation to protect retail investors from crypto winter fallout
SIngapore's financial regulator says there is need for global collaboration to better regulate the crypto industry because of its "borderless nature."
2 min read
Updated: Jul. 5, 2022 at 2:52 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
The Monetary Authority of Singapore (MAS) is considering new regulations to protect retail investors after the crypto market crash led to the collapse of several crypto firms.
According to the regulator, the new rules being considered include “placing limits on retail participation, and rules on the use of leverage when transacting in cryptocurrencies.”
MAS continued that there is a need for global collaboration to better police the crypto industry due to the ‘borderless nature’ of its market.
The regulator also rehashed some of its previous efforts to protect retail investors from the crypto industry, like warnings that crypto is not for retail investors and the restriction of crypto ads that do not emphasize the risks of such investment.
Singapore-based crypto companies in the market crash
The new warning by the regulator is unsurprising considering the role Singapore-based companies like Terraform Labs and Three Arrows Capital played in the crypto market crash.
MAS reprimanded Three Arrows Capital (3AC) for exceeding the limit for assets under management and providing false information about its operations. The regulator is investigating whether the hedge fund breached other rules.
A concerned citizen filed a police report against Terraform Labs, the developers of the crashed Terra tokens, LUNA and UST.
Vauld, a crypto lender in the country, suspended withdrawals due to liquidity issues. The firm has hired advisers as it considers restructuring.
Singapore’s mixed crypto signals
Authorities in Singapore are walking the thin line between consumer protection and openness to crypto.
Sopnendu Mohanty, MAS’ chief fintech officer, in a LinkedIn post, praised the leadership of crypto firms like Binance, Crypto.com, and Ripple, saying they are ‘fully committed to building a secure and sustainable innovation solving real problems.’
Meanwhile, the stringent regulatory demands of the authorities have pushed several crypto firms out of the country. Singapore has licensed only 14 companies to operate out of almost 200 applications.
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Posted In: Singapore, Regulation
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Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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In this article
Terra is a blockchain protocol that uses fiat-pegged stablecoins to power price-stable global payments systems.
TerraClassicUSD
$0.02113
TerraUSD (UST) is a decentralized and algorithmic stablecoin on the Terra blockchain.
Crypto.com
Crypto.com was founded in 2016 on a simple belief: it’s a basic human right for everyone to control their money, data and identity.
Binance
Binance is a global cryptocurrency exchange that provides a platform for trading more than 100 cryptocurrencies.
Ripple
Ripple is a US-based technology company which develops the Ripple payment protocol and exchange network using XRP, the digital asset native to the XRP Ledger.
Three Arrows Capital
Three Arrows Capital (3AC), a Singapore-based crypto hedge fund, collapsed due to poor risk management, recklessness in dealing with business partners and a significant portion of greed.
Terraform Labs
Terraform Labs is a startup that created Terra, a blockchain protocol and payment platform used for algorithmic stablecoins.