• Thu. Feb 22nd, 2024

Singapore Authorities Shocks Cryptocurrency Traders, Introduce Bold Rules

Maria Bartiromo

ByMaria Bartiromo

Nov 25, 2023
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The Monetary Authority of Singapore (MAS) has introduced new regulations that caution Digital Payment Token (DPT) service providers against providing incentives for cryptocurrency trading. This is a bold move and a significant development for the cryptocurrency market.

The sudden regulatory intervention has caused a stir in the cryptocurrency community as traders and industry participants consider its ramifications. The DPT service providers are the focus of the MAS’s advisory, which asks them to desist from offering any incentives to promote cryptocurrency trading.

The MAS has taken proactive steps due to concerns about significant risks and potential harm to consumers, which indicates a change in Singapore’s regulatory environment for digital assets. The market has responded to the MAS’s advice in different ways.

Some praise the regulator for taking a proactive stance in mitigating risks and safeguarding investors, while others voice apprehensions regarding the influence on market dynamics and the capacity of DPT service providers to compete effectively.

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MAS Moves To Discourage Service Providers Taking Advantage Of Bonuses

MAS says they are working on discouraging service providers from providing benefits or bonuses that might sway trading decisions. This, they say is to promote a more cautious and knowledgeable approach to cryptocurrency investments.

This action is being taken when international regulators are stepping up their examination of the cryptocurrency market to address the issues raised by the asset class’s explosive growth and growing acceptance. This development started gathering attention from prominent persons in the cryptocurrency industry.

Lacton Muriuki from CryptoPolitan says that Singapore is currently putting itself in a position to balance protecting market participants with promoting innovation. Some cryptocurrency traders contend that incentives have been essential in promoting user engagement and adoption in the industry.

Recent observation shows that DPT service providers have frequently used cashback incentives, rewards programs, and other forms of compensation to draw in and keep customers. As of press time, concerns are raised regarding how these marketing strategies will develop in the Singaporean cryptocurrency market.

Deputy Managing Director Speaks, Says They Can’t Save Everyone

MAS says it hopes to support the market’s long-term stability by reducing the risks connected with speculative trading and discouraging an excessive reliance on estimates of the value of cryptocurrency assets. Muriuki, in his article on the CryptoPolitan platform, says that how regulators across the globe will handle the changing terrain of digital assets is still being determined.

MAS has confirmed that digital asset holders will not be included in the customer’s net worth calculation. This approach allows people to overrate their financial capacity based on cryptocurrency value. Amid these precautionary measures, MAS has acknowledged that cryptocurrency trading remains highly speculative and dangerous.

MAS has introduced Global Layer One, a project centered on look for new designs of an open digital facility, capable of hosting a tokenized financial applications and assets. This program, the regulator said is another way the country is looking to create an enabling environment for the country’s financial industry.

According to the Deputy Managing Director at MAS, Ho Hern Shin, while the new customer access and business conduct are properly implemented, such moves can help void the system of risks. He said that they can only partially develop ideas to help prevent it from the risks. Shin also said his agency cannot fully protect customers from the losses usually incurred from cryptocurrency trading.

Maria Bartiromo

Maria Bartiromo

Maria Bartiromo is a renowned news writer and journalist, celebrated for her insightful reporting and authoritative voice. With a career spanning years, she has established herself as a trusted source of accurate and comprehensive news analysis, keeping readers informed on vital global developments.

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