Singapore through its regulators is looking to tighten its Crypto regulations to discourage retail investors from dealing in the nascent industry. This is according to a Reuters report.
This move was announced by the Managing director of the Monetary Authority of Singapore (MAS), Ravi Menon at an event on Monday.
According to the director, the agency’s numerous warnings and measures have done little to discourage retail investment in the space. As per the director, different surveys shows an increase in consumer participation in crypto Investment in Singapore.
Therefore, the agency is considering creating restrictions on institutional access to digital currency. In the event themed “Yes to digital asset innovation, No to Cryptocurrency speculations,” the regulator shared his views on the planned restrictions.
These include carrying out tests on customers’ risk appetite to limit retail participation. It will also limit the use of leverage and credit facilities for cryptocurrency trading.
In all, the MAS will entertain input from the public regarding the proposed move in October.
MAS moves to protect Investors
As part of plans to protect inexperienced users, the MAS has always been vocal about the space’s volatility. Its sharp speculative price swings have also been a source of worry for the regulator.
The recent crash in market price and subsequently liquidity issue with several crypto firms gives credence to the regulator’s position.
With Bitcoin (BTC) and Ethereum (ETH) leading the pack, most digital currencies have seen their valuations halved. Prices of major cryptocurrencies have dwindled and their investment sentiments have become bearish over the past few months.
Several billions of Investors’ funds have been lost due to this downturn. Several billion are also trapped in troubled crypto firms battling liquidity crises.
Earlier in January, MAS restricted the advertisement and promotion of cryptocurrencies, especially in public places. Public digital currency ATMs were removed, and advertisements in transportation parks were also pulled off.
Additionally, the regulator also discouraged the trading of crypto in a manner that fails to adequately project the risks involved. MAS encouraged investors and customers to be fully equipped with information about their intended investment.
Also, a recently passed bill has empowered the MAS to license all virtual asset service providers operating on its shore.
The MAS has always maintained that cryptocurrency investment is a highly risky venture and not suitable for the retail public.