{"id":31211,"date":"2023-07-04T07:24:14","date_gmt":"2023-07-04T11:24:14","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/crypto\/singapores-monetary-authority-enforces-crypto-lending-and-staking-ban-for-retail-investors\/"},"modified":"2023-07-04T07:24:16","modified_gmt":"2023-07-04T11:24:16","slug":"singapores-monetary-authority-enforces-crypto-lending-and-staking-ban-for-retail-investors","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=31211","title":{"rendered":"Singapore’s Monetary Authority Enforces Crypto Lending and Staking Ban for Retail Investors"},"content":{"rendered":"
\n

Singapore’s chief financial watchdog has decided to enforce a ban on lending and staking for retail customers.\u00a0<\/p>\n

On July 3, the Monetary Authority of Singapore<\/strong> (MAS) revealed a set of new requirements for what it calls “Digital Payment Token (DPT) service providers”.\u00a0<\/p>\n

These rules are meant “to safekeep customer assets under a statutory trust before the end of the year.”<\/p>\n

Under Singapore’s law, digital payment token services refer to services that assist in the buying or selling of digital payment tokens, aka cryptocurrencies. These services may be provided by exchanges.<\/p>\n

Following several months of discussions and public consultations on the issue, starting with October 2022, the regulator stated that,<\/p>\n

\n

“MAS will also restrict DPT service providers from facilitating lending and staking of DPT tokens by their retail customers.”<\/p>\n<\/blockquote>\n

These activities, it argued, are not suitable for the retail public. That said, the providers are allowed to continue offering lending and staking services for their institutional and accredited investors.<\/p>\n

MAS did acknowledge that there were opposing views as well. Some respondents argued for allowing exchanges to offer these services but with the retail customer\u2019s consent and risk disclosures.<\/p>\n

Others, however, “advocated a ban on these high risk and speculative activities,” the regulator said.<\/p>\n

MAS requires exchanges to safeguard customers’ money, and segregate customers\u2019 assets from the exchange’s own assets, keeping the former in trust.<\/p>\n

In line with this, the custody function must be operationally independent of other business units.<\/p>\n

Furthermore, the exchanges operating in the country will need to conduct daily reconciliation of customers\u2019 assets.<\/p>\n

Customers must be clearly informed of the risks related to having assets on an exchange.\u00a0<\/p>\n

According to the announcement, the requirements will reduce the risk of loss of customers’ assets, or their potential misuse.<\/p>\n

Furthermore, they will facilitate the recovery of assets in the event of insolvency. Nonetheless, MAS warned that there may still be significant delays in recovering assets.<\/p>\n

Currently, MAS is asking for public feedback on the draft legislative amendments to the Payment Services Regulations to put the requirements into effect.\u00a0<\/p>\n

It also plans to publish guidelines in “due course” aiming for consistent implementation of the rules.<\/p>\n

Additionally, MAS issued a separate consultation paper proposing requirements for DPT service providers to address unfair trading practices, and it plans to define conduct that constitutes wrongful offenses as well as legislative provisions.\u00a0<\/p>\n

Meanwhile, in June this year, MAS released a whitepaper on purpose-bound money (PBM), a protocol meant to define benchmarks for the use of digital money including central bank digital currencies (CBDCs) and stablecoins.\u00a0<\/p>\n

____<\/p>\n

Learn more:\u00a0<\/h3>\n

– Ripple Gets In-principle Approval for Singapore Digital Payment License
– Circle Gets Its Singapore MPI Licence<\/p>\n

– Singapore Venture Capital Firm Foresight Ventures Launches Second Phase of Web3 Accelerator
– Hong Kong Should Follow Singapore, Japan in Crypto<\/u><\/p>\n

– How to Choose a Cryptocurrency Exchange?
– Why It Is Risky To Leave Your Cryptocurrency In Exchange<\/p>\n<\/p><\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Singapore’s chief financial watchdog has decided to enforce a ban on lending and staking for retail customers.\u00a0 On July 3, the Monetary Authority of Singapore (MAS) revealed a set of new requirements for what it calls “Digital Payment Token (DPT) service providers”.\u00a0 These rules are meant “to safekeep customer assets under a statutory trust before […]<\/p>\n","protected":false},"author":1,"featured_media":31212,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[243],"tags":[83],"class_list":["post-31211","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-crypto","tag-featured"],"yoast_head":"\nSingapore's Monetary Authority Enforces Crypto Lending and Staking Ban for Retail Investors | iFintechWorld<\/title>\n<meta name=\"description\" content=\"Singapore's chief financial watchdog has decided to enforce a ban on lending and staking for retail 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