The Monetary Authority of Singapore (MAS), Singapore’s financial regulator, said it was working on amending the city-state’s digital asset regulations to cover more than anti-money laundering. money and the fight against the financing of terrorism (AML/CFT) and will soon organize public consultations. on this point.
Chief Minister and Minister in charge of MAS, Tharman Shanmugaratnam, made the announcement in a written response to a parliamentary question posed by MP Saktiandi Supaat from the Bishan-Toa Payoh Group Representation Constituency.
The questions for the Prime Minister touched on three points: whether the MAS has any data on the extent of Singaporeans’ exposure to the Terra ecosystem crash; whether efforts to revive the ecosystem pose additional systemic risk to the economy; and what steps is the regulator taking to review industry regulation.
Shanmugaratnam said the MAS does not have full details of Singaporeans’ digital assets. However, MAS data shows that banks have insignificant exposure to the Terra ecosystem, suggesting that the risk of contagion from the digital asset market crash to the traditional financial sector is limited.
He further pointed out that, like other global regulators, the MAS is working to revise its approach to regulating digital assets. This review will significantly target stablecoins, he added.
“MAS is evaluating the merits of a regulatory regime tailored to the specific characteristics and risks of stablecoins, such as reserve requirement regulation and peg stability, and will consult with the public in the coming months,” Shanmugaratnam wrote.
The response echoes statements he made last month while responding to another parliamentary inquiry into MAS plans to regulate digital asset firms. He noted that the MAS would leverage its recently expanded powers to redefine digital assets and introduce additional consumer protection safeguards.
Singapore disassociates from collapsed digital asset firms
Spurred by the collapse of Terra and other digital asset companies like Three Arrows Capital (3AC) based in the city-state, Singapore has decided to be relentless on the digital asset industry.
The MAS has cracked down hard on companies that give it bad publicity. According to a Bloomberg report, the MAS issued a reprimand to 3AC and has several ongoing investigations into the asset manager and Luna Foundation Guard (LFG).
The MAS has also distanced itself from companies. In a recent report, Ravi Menon, Managing Director of MAS, said the companies, especially LFG and 3AC, are not representative of Singapore’s approach to digital asset regulation. He revealed that 3AC had already lost its registration with MAS before its liquidity fallout.
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