The Monetary Authority of Singapore (MAS) evaluates the regulatory regime’s merits for stablecoins. The present instructions deal with Anti-Money Laundering as well as Know Your Customer (KYC) matters without reflecting the particular hazards associated with the stablecoins.
Financial Watchdog of Singapore Moves toward Public for Stablecoin Regulation
On Monday, the official portal of MAS released a noted reaction by Tharman Shanmugaratnam – the head of the regulator – to a query posed on the behalf of a member of Singaporean parliament. The query asked if the data is available on the degree of the exposure that the citizens had to the recent value collapse of Luna Classic (LUNC) as well a TerraUSD Classic (USTC), and if the regulator is taking active measures to cope with such disasters.
Shanmugaratnam admitted that the crash of Terra elaborates the high risks linked to crypto investment however emphasized that the chaos has not influenced the overall financial system as well as the economy to a great extent. In his answer’s large proportion, the official disclosed the present strategy of the agency for stablecoins.
He asserted that the regulator is enthusiastically assessing its attitude toward the stablecoin regulation because of the present agenda – in which the status of stablecoins as well as the rest of the cryptocurrencies is that of digital payment tokens (DPTs) – is not sufficient to take into account the particular hazards. Thus, the qualities of a regulatory regime (that is structured for the particular aspects of stablecoins) are being evaluated by MAS.
Singapore Expands Stablecoin Regulation to Tackle New Challenges
It will be centered around such characteristics to regulate the peg’s stability as well as the reserve requirements. As specified by the response, MAS intends to know about the stance of the common masses regarding the potential guidelines in the next months. On 19th July, MAS’ managing director – Ravi Menon – openly rejected the connections between Three Arrows Capital (a hedge fund of cryptocurrency that is going through proceedings of its bankruptcy process), TerraForm Labs, as well as the Singaporean crypto regulation.
Menon also stressed the requirement to transfer the regulatory attention from KYC and AML to the more diverse hazards that the crypto space poses. In his words, the latest guidelines are included in the endeavors of MAS to be benefitted from the financial industry to assist Singapore in its objective of gaining net zero until 2050 via green strategies of finance.