Source of article: The straits times
In summary:
The MAS has just announced the final segment of its rules on retail safeguards and business conduct for digital token payment service providers regulated in Singapore.
It is significant that the definitions of retail investors and accredited investors are made clear in the proposed measures.
My comments on the proposed measures on consumers safeguards and business conduct:-
Consumer safeguards
The proposed consumer access measures are regulatory refinements to further safeguard retail consumers against crypto scams and the abject vicissitudes of fortune in the crypto industry.
Retail consumers must not however place blind faith or reckless trust in crypto operators who are licensed by the MAS. All investments carry risks. The caveat emptor principle must always be borne in mind before making any investment whether in the real or crypto world.
There are no substitutes for making informed decisions in any investment, having a clear understanding of the terms and conditions of the proposed investment, and keeping abreast of corporate developments concerning the operator. No regulation can mitigate the risks of speculative greed if one chooses to throw caution to the wind in the hope of making a fortune overnight.
Retail consumers must take precaution not to unwittingly be complicit in any money-laundering or other illicit schemes, akin to being money mules in the crypto world. The legal consequences for abetting any such illegal activities are severe. The risks of being inadvertently involved in money laundering and/or funding of terrorists’ activities are real when consumers are drawn to participating in “get-rich” schemes promised by crypto operators who are situated in a borderless world – not within the legal jurisdiction of any established financial market that has proper regulatory guardrails and rigorous enforcement regimes.
Business conduct
The proposed enhanced business conduct rules are in tandem and commensurate with the proposed consumer access measures. The effectiveness of the rules lies in vigorous consistent surveillance and robust enforcement actions against any breach by crypto operators.
Operators must have in place a capable team to institutionalise the rules and ensure full compliance thereof. The need for cyber hygiene, high reliability, and effective timely recoverability of critical systems are paramount to enable licensed operators to fully comply with the terms and conditions required by the MAS.
I thank Claire Huang from the Singapore Straits Times for publishing my thoughts on the measures announced by the MAS today.
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