The Monetary Authority of Singapore, which is the country’s central bank, has no plans to ban cryptocurrency trading at the moment, though MAS does intend to eventually regulate digital asset exchanges and other entities to ensure AML/CFT compliance.
Singapore’s deputy prime minister, who doubles as the minister in charge of the Monetary Authority of Singapore (MAS), has said that the central bank currently sees “no strong case to ban cryptocurrency trading.”
The revelation was included in responses that the deputy PM, Tharman Shanmugaratnam, delivered on February 5 (and were posted on February 7) to a series of questions from parliamentarians Saktiandi Supaat, Lim Biow Chuan, and Cheng Li Hui, regarding how MAS intends to regulate digital assets.
Shanmugaratnam also said that MAS would impose “anti-money laundering and countering the financing of terrorism (AML/CFT) requirements on the intermediaries that buy, sell or exchange virtual currencies.” These measures, as he noted in his responses, were described broadly in MAS’s public consultation on a proposed Payment Services Bill.
A November 2017 paper on that consultation states that “virtual currency service” providers, including cryptocurrency exchanges and “exchanges that originate from” ICOs, will be subject to mostly unspecified AML/CFT standards. These requirements “will include the identification and verification of customer and beneficial owner, ongoing monitoring, screening for ML/TF concerns, suspicious transaction reporting and record keeping.”
Entities transacting in certain “types of virtual currency that are limited in user reach and scope of use as services,” such as in-game assets and loyalty points, will not be subject to the AML/CFT regulation in the forthcoming bill, however.
Until such a law is passed, the deputy PM said, the AML/CFT safeguards in place include enforcement agencies being “on the lookout for illegal activities related to cryptocurrency trading” and a requirement on all Singaporeans “to report suspicious transactions, which they come across in the course of their trade, profession, business or employment.”
The central bank has previously stated that some digital tokens issued in ICOs are subject to regulation under Singapore’s Securities and Futures Act.
Overall, MAS does not see major “systemic risk concerns with regard to cryptocurrencies,” in part because their “use in making payments is small” and “Singapore’s banking system does not have any significant exposure to global and local entities dealing in cryptocurrencies.”
Shanmugaratnam also noted in his responses that blockchain technology has “potentially useful applications in facilitating payments and trade settlements.” In this vein, he alluded to MAS’s involvement in Project Ubin, an Ethereum-based pilot in which prominent financial institutions from Singapore, the US, Japan, and elsewhere are participating.
Adam Reese is a Los Angeles-based writer interested in technology, domestic and international politics, social issues, infrastructure and the arts. Adam is a full-time staff writer for ETHNews and holds value in Ether and BTC.
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