- Both consultation papers aim to reduce consumer buying and selling risks.
- The 2nd consultation paper offers recommendations for Singapore’s stablecoin regulatory framework.
The Financial Authority of Singapore (MAS) is applying proposals to better control cryptocurrencies. Two consultation papers on suggestions for controlling those activities of stablecoin issuers and digital payment token providers (DPTSP) underneath the Payment Services Act happen to be released through the central bank of Singapore.
Both consultation papers aim to raise stablecoin transaction standards minimizing consumer risks connected with cryptocurrency buying and selling. The very first document contains recommendations for services involving digital payment tokens (DPTs) or services linked to well-known cryptocurrencies like Bitcoin, Ethereum, and XRP.
The regulator contends that cryptocurrency providers should not be allowed to simply accept payments created using charge cards in return for cryptocurrency services. The MAS also advised DPTSPs to consider applying consumer tests to gauge retail customers’ understanding of the risks connected with cryptocurrencies.
Restrict Stablecoin Issuers From Lending
Some business and operational needs for stablecoin issuers are supplied within the second consultation paper, making regulatory approach proposals for stablecoins in Singapore. The MAS recommended banning the lending or staking of single-currency pegged stablecoins (SCS), along with the buying and selling of other cryptocurrencies.
The absolute minimum base capital dependence on $a million or 50% from the SCS issuer’s annual operating expenses seemed to be suggested through the regulator. Based on MAS, the main city should always take place and contain liquid assets. By December 21, 2022, the regulator requested comments around the proposals all your customers.
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