- The authorities also extended the period of strict restrictions for crypto exchanges.
- They obligated them to keep client funds in special trusts
Monetary Authority of Singapore (MAS) obligated crypto exchanges to extend the placement of client funds in trusts until the end of the year. They continued the special protection program that is in place after the fall of FTX.
The authorities also want to consider banning retail lending and collateral in cryptocurrencies. This bill has been under study since last October, before the FTX story.
In its press release, MAS writes about the need to tighten the regulatory regime for digital assets.
“Current regulations cannot protect consumers from all losses given the extremely high risk and speculative nature of digital payment token trading”
The agency also reminded citizens that they should exercise “extreme caution” when trading cryptocurrencies.
The new tightening goes against Singapore’s recent crypto-friendly initiatives. On June 21, the Monetary Authority published a proposal for a common protocol that defines the conditions for the use of various types of digital money, including CBDC.
The new concept is called “Purpose Bound Money” (“target tokens”). The project is designed to allow senders to specify the terms of transactions in cryptocurrencies, including expiration dates and storage types, in various systems.