Singapore Central Bank has released a response to industry feedback on a consultation paper of proposed regulations for crypto service providers. In its response, the central bank kept the requirement for crypto entities to discourage cryptocurrency speculation by retail customers by not offering financing, margin transactions, or any incentives to trade.

The Monetary Authority of Singapore (MAS) also wants crypto entities to not accept locally issued credit card payments and to assess a customer's risk awareness before allowing access to the services. Singapore's ongoing crypto regulatory measures Singapore is looking to strike a regulatory equilibrium in the crypto sector while enticing industry participants. The recent announcement represents the second phase of the response to feedback on the proposed regulations for digital payment token (DPT) service providers in Singapore.

In the initial instalment in July 2023, providers were mandated to deposit customer assets in a statutory trust by year-end for secure custody. Officials from blockchain intelligence company TRM Labs said that MAS has been very consistent about its stance against speculative retail trading, so it is unsurprising that they are largely moving ahead with their proposals. That said, they've landed on slightly less restrictive measures in areas such as the inclusion of cryptocurrencies in determining customers' net worth.

This shows that MAS is listening, and is willing to consider industry feedback, even if they do not always agree. Among the less restrictive measures, MAS has eased the limits on qualifying as an accredited investor, clarifying that some crypto assets can be counted toward the USD 1.5 million needed. It also appears to have allowed exchanges to come up with their own criteria for listing tokens as long as they disclose conflicts of interest, publish criteria that govern the listing, and establish procedures to resolve customer disputes.

Introducing special reporting stipulations The MAS also has high availability and risk-incidents reporting stipulations. These are in line with current requirements imposed on other systemically important financial institutions, but not payment service providers, making this a special provision for crypto. The rules will take effect in phases from mid-2024 to provide an ‘adequate transitional period’ for their implementation.

The rules are aimed at limiting potential consumer harm, MAS said. Previous news from MAS In November 2023, the Monetary Authority of Singapore and Bank Negara Malaysia have collaborated to launch a cross-border real-time payment system connecting PayNow and DuitNow. This initiative enables instant fund transfers between the two countries using the recipient's mobile phone number or Virtual Payment Address.

The partnership also facilitates secure and efficient person-to-person cross-border fund transfers, aligning with the preferences and demands of clients in Singapore and Malaysia. This collaboration builds upon the QR payment linkage announced in March 2023, extending the benefits to merchants and traders for cross-border QR payments. .