The Blockchain Association of Singapore sent a feedback report to local regulators on the recent crypto proposals, warning that certain measures to tighten access could drive demand to unregulated providers.
In October 2022, the Monetary Authority of Singapore (MAS) issued a consultation paper on proposed regulatory measures to tighten the crypto industry, including restrictions against lending coins for yields or borrowing to fund token purchases.
While the regulator said this was intended for investor protection, industry group Blockchain Association of Singapore (BAS) said this could instead simply drive users to seek alternatives abroad.
«We would caution that by introducing consumer access measures, this could have a perverse impact of leading consumers to move towards unregulated digital payment token service providers (DPTSPs) which operate outside of Singapore,» BAS said in an 11-page feedback report published online. «In addition, DPTSPs may also be motivated to provide services through foreign unregulated entities.»
Counter Proposals
In response, BAS provided some proposals of its own to help mitigate crypto risks without pushing demand to unregulated providers.
«We suggest that MAS enhance its consumer education efforts to raise greater awareness of the risks of dealing with unregulated entities (particularly those based outside of Singapore), and to also increase enforcement activities to prosecute those engaging in activities with customers in Singapore without the requisite regulatory approvals under the Payment Services Act 2019,» BAS said.
The feedback report was based on comments from about 180 individuals who attended a members’ seminar conducted by BAS in November.
