Singapore has expanded its regulatory framework for the cryptographic industry. The new guidelines clarify anti-money laundering and counter-financing of terrorism rules for payment token issuers.
The Monetary Authority of Singapore (MAS) this week released a refinement to the regulatory framework for cryptographic companies published earlier this year. The new document clarifies the anti-money laundering and anti-terrorist financing rules for providers of digital payment tokens. The document says:
"Rapid improvement of technologies has seriously affected the world of payments. In particular, changes in financial technologies have opened up new opportunities for faster and more efficient payment methods. However, these new payment methods have created new risks of money laundering and terrorist financing".
MAS recommends tracking "as many" past token transactions as possible in order to determine their possible use for illegal activities. Singapore is a good example of how a country's central bank can help develop its cryptographic industry by developing a fairly favourable regulatory framework that does not automatically discriminate against users and service providers.
"MAS observations suggest that the use of crypto assets in the region has increased in recent years. Speculative trading on exchange platforms peaked in early 2018 with the growth of crypto market capitalisation, although monthly trading volumes are less than 1% of Singapore Stock Exchange transactions.
While Singapore's Payment Services Act recognises "potential AML/CFT risks in relation to crypto assets", most of the rules proposed by MAS were quite flexible. While the country is currently actively developing a framework to attract cryptographic enterprises, MAS recognizes that the cryptographic industry in the region is slow to develop and is only responsible for a small percentage of total cryptographic asset turnover. MAS notes:
"It's worth noting that despite Singapore's status as a center of fusion, Singapore's crypto transactions are only responsible for a small percentage of global transactions and do not play a significant role in the country's economy compared to traditional finances.
Recall that last month the Monetary Authority of Singapore approved the iSTOX platform, specializing in trading in tokenized securities, and allowed it to conduct operations in the region. In addition, last November it was reported that MAS may soon allow trading in crypt currency derivatives on regulated platforms.
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