The Monetary Authority of Singapore (MAS) regards crypto trading as “highly hazardous” for retail investors in the country, according to a statement from the central bank’s managing director, Ravi Menon.
Speaking at an event on Monday, Menon said that despite warnings and measures from MAS, surveys revealed that retail investors are increasingly trading in crypto assets in Singapore, attracted by the possibility of their price increase. He noted that these investors seem “irrationally oblivious” about the risks of crypto trading.
Making Crypto Trading More Difficult
According to the MAS chief, Singapore is now planning to set up a new regulation that will make it harder for retail investors to trade in cryptocurrencies to protect them against the risk associated with crypto trading.
Explaining how the central bank plans to make it difficult for retail investors to trade in cryptocurrencies, Menon said:
“These may include customer suitability tests and restricting the use of leverage and credit facilities for cryptocurrency trading.”
However, he noted that banning retail access is unlikely to work given the borderless nature of the asset class.
“With just a mobile phone, Singaporeans have access to any number of crypto exchanges in the world and can buy or sell any number of cryptocurrencies,” he said.
Menon then noted that a “multi-pronged approach” is needed to protect investors against crypto trading risks. MAS will seek public consultation on its proposals by October this year and reviews are ongoing by regulators globally, Menon said.
Tough Stance on Crypto
Singapore has continued to maintain its tough regulatory stance toward the crypto industry in recent times. Earlier this year, MAS issued a stern warning to crypto firms against advertising their products to the public, saying that such activities could harm investors.
Meanwhile, Singapore has further intensified its focus on crypto-related companies operating in the country after some have struggled to stay afloat due to the recent market crash.
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