MAS Considers Imposing Additional Safeguards Against Crypto Trading

MAS Considers Imposing Additional Safeguards Against Crypto Trading

by July 5, 2022

The Monetary Authority of Singapore (MAS) has been carefully considering the introduction of additional consumer protection safeguards to protect them against sharp speculative price swings.

Tharman Shanmugaratnam, Senior Minister and Minister in charge of MAS said in a parliamentary reply that the regulator may consider placing limits on retail participation, and rules on the use of leverage when transacting in cryptocurrencies.

However, he acknowledged that there will be a need for regulatory coordination and cooperation globally given the borderless nature of cryptocurrency markets

Tharman revealed that these issues are being discussed at various international standard setting bodies where MAS actively participates.

In January this year, MAS had restricted the marketing and advertising of cryptocurrency services in public areas, and disallowed cryptocurrency trading being portrayed in a manner that trivialises its risks.

The regulator expects all entities dealing in cryptocurrencies (termed digital payment token or DPT service providers) in Singapore to comply with its MAS guidelines.

Since then, DPT service providers have taken actions to meet these rules, such as removing cryptocurrency ATMs from public areas and taking down advertisements from public transport venues.

DPT service providers are currently regulated under the Payment Services Act (PS Act) primarily for money laundering and terrorism financing risks.

But the PS Act also empowers MAS to impose additional measures on DPT service providers to ensure better consumer protection, and to maintain financial stability and safeguard the efficacy of monetary policy.

Tharman Shanmugaratnam

Tharman Shanmugaratnam

Tharman added,

“Since 2017, MAS has consistently warned that cryptocurrencies are not suitable investments for the retail public. Most cryptocurrencies are subject to sharp speculative price swings. Recent events have vividly demonstrated the risks, with prices of several cryptocurrencies falling drastically.


MAS reiterates its warning: cryptocurrencies are highly risky and are not suitable for the retail public. People can lose most of the money they have invested, or more if they borrow to purchase cryptocurrencies.”