Amid the currently spreading liquidity crunch as well as the problems related to withdrawals, the Monetary Authority of Singapore (MAS) is taking action to arrange an exclusive regulatory agenda for cryptocurrency to deal with such issues. The central bank of the country has delivered elaborated questionnaires on a few applications as well as the holders of the licenses related to the Digital Payment Token of the MAS, as reported on Friday by Bloomberg.
MAS of Singapore Scrutinizes Crypto Venues before New Regulations
The questionnaires, which were sent during the previous month, were reportedly demanding extremely rough information from the crypto exchanges regarding the business operation as well as the holdings. The forms were centered around the financial stability of the companies as well as their interconnection.
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The questions were also related to the highest borrowing and lending counterparties, the loaned amount as well as the most prominent tokens staked through the protocols related to decentralized finance (DeFi). While referring to the people acquainted with the subject, the report mentions that the companies were anticipated to respond immediately.
Up to ten licenses have been issued by the MAS in Singapore thus far, taking into account the exchanges such as Crypto.com as well as DBS Vickers (the brokerage branch of DBS Bank). That counts as a considerable small proportion of approximately two hundred companies that have requested the licenses.
The unique regulatory measures taken in Singapore are seemingly focused on increasing the inspection of the crypto venues during the exclusive regulations to administer the industry. In the last month’s mid, Ravi Menon – the managing director of the MAS – revealed that the financial regulator was operating on a regulatory agenda to cover the aspects such as market conduct, customer protection, and the reserves to support stablecoins during the coming months.
MAS Highlights Loopholes in Singapore’s Existing Crypto Regulatory Agenda
Particularly, the MAS referred to the blind spots present within the current crypto regulations operating in Singaporean jurisdiction, mentioning that the providers of services related to the Digital Payment Tokens are not liable to risk-based liquidity or capital requirements. At the moment, they additionally do not need to protect the digital tokens or funds of the consumers from insolvency hazards.
Rather, regulations majorly emphasize terrorism financing, money laundering, and technology-related risks. The impending regulatory agenda of Singapore for crypto is witnessed as a reply to the presently prevailing liquidity issue and the linked withdrawal-related problems in a prolonged bear market.
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