Singaporean regulators are increasing their control over the country’s cryptocurrency trading activity. The head of Singapore’s central bank stated that the city is mulling new steps to make cryptocurrency trading even more challenging for retail investors on Monday, August 29.
The Monetary Authority of Singapore’s (MAS) managing director, Ravi Menon, said the following in a seminar on Monday:
“Adding frictions on retail access to cryptocurrencies is an area we are contemplating. “These may include customer suitability tests and restricting the use of leverage and credit facilities for cryptocurrency trading”.
He added that retail investors have been “irrationally oblivious” to the dangers involved in trading cryptocurrencies. The MAS established guidelines in January of this year to restrict cryptocurrency trading service providers from advertising their services to the general public. This was a move to protect small-scale investors from the market’s turbulence.
MAS Is Moving Forward with Crypto Regulations
The MAS is implementing new measures to introduce crypto rules into the nation in order to address the ongoing liquidity problem and withdrawals, particularly with the present situation with the troubled hedge fund Three Arrows Capital.
All businesses holding MAS’s Digital Payment Token licenses received thorough questionnaires from the central bank of Singapore last week. The objective, according to the Bloomberg article, was to gather “very granular information” on the operations and assets of the scrutinized crypto businesses.
The MAS seeks to examine the interdependence and financial stability of crypto companies. The collapse of the hedge firm Three Arrows Capital this year has dealt a serious blow to the cryptocurrency markets.
The top lending and borrowing counterparties, top tokens owned, top tokens staked via decentralized finance protocols, and the amount loaned are just a few of the critical information that the MAS is aiming to gather from cryptocurrency enterprises.
The head of MAS, Ravi Menon, stated that they have been working on a regulatory framework last month in July. Consumer protection, market behaviour, and reserve backing for stablecoins will all be covered by this framework.
