Although the identity of the affected firm was not revealed, the MAS indicated in its statement that the reason for halting the proceedings of the STO launch was because of a regulatory breach by the company
According to the statement, the affected crypto startup tried to utilize an exemption in Singapore’s Securities and Futures Act.
This clause in the act gives securities’ issuers the right to sell their assets only to accredited investors that can boast of a certain amount of investment before they can be regarded as being “qualified” to invest.
Since the firm is adopting an exemption in the MAS’ act, it refused to follow the rules the law to the letter.
The firm was accused of advertising its token sales on Linkedin, which could see the company raise money from the general public, as opposed to the sales of tokens to accredited investors as stated in the exemption the company used.
Lee Boon Ngiap, assistant managing director of capital markets at MAS was quoted as saying in the statement,
Where an offer is made to the public, a prospectus is required to ensure that investors are provided with all the information to make informed investment decisions.
Ngiap also went further to say that offers that are limited to a restricted group of persons do not require an advertisement. However, if a firm goes contrary to the rules, the firm would be met with stern sanction.
Singapore provides a well-regulated environment
It can be recalled that in May 2018, the MAS issued a warning to eight crypto exchanges. At the time, the financial regulators made it clear that it is not ready to change its stance on crypto firms’ compliance with all relevant laws of the agency while promising to provide a permissive, yet regulated environment for blockchain and cryptocurrency businesses in the country.
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