Singapore is thinking about putting more limits on how people can buy and sell cryptocurrencies because the market is losing value and several companies are going out of business.
In response to a question from the city-parliament, state’s Tharman Shanmugaratnam, Chairman of the Monetary Authority of Singapore (MAS), wrote, “MAS has been carefully thinking about adding more protections for consumers.”
He also said that the new rules might limit how much retail investors can take part in cryptocurrency trading and how much leverage they can use.
“However, since cryptocurrency markets don’t have borders, regulators all over the world need to work together and coordinate. These issues are being talked about in different international groups that set standards, where MAS is an active member,” Shanmugaratnam said.
The Latest Market Disturbance
Several companies that deal with cryptocurrency are based in Singapore. But a number of big companies in the city-state went out of business because of the market slump.
Terraform Labs is based in Singapore. When its USD-pegged algorithmic stablecoin failed, it sent shock waves through the crypto industry. It is also the home of Three Arrows Capital, a crypto hedge fund that is about to go out of business. Most recently, Vauld, a crypto lending and trading platform based in Singapore, stopped withdrawals and other services and is now thinking about how to change.
But Singapore’s government was always careful as the cryptocurrency market grew. Since 2017, MAS has been warning about the market’s volatility by saying that “cryptocurrencies are not good investments for the general public.”
Also, the regulator put a lot of restrictions on crypto promotions in its area last January. It made it harder to market and advertise cryptocurrency services in public places. As a result, some companies took their ads down from public transportation and took their crypto ATMs away.
In order to do business in Singapore, crypto startups need a license from the MAS. The process is thought to be tough because, out of about 200 applicants, only 14 businesses have been given permission to work in the area so far.
