New Crypto Regulations in Singapore: Companies to Provide Full InformationAugust 28, 2022
Authorities in Singapore have begun taking action to increase their oversight in the digital assets sector. The central bank is now requesting that companies present more information about all their activities and any assets they might have. The central bank is trying to have a proper assessment of companies’ financial condition.
Required Cooperation Across the Board
Singapore’s Monetary Authority called on all the crypto companies operating with its issued license to cooperate with the new requirement. It also includes some new applicants for the crypto operating license. Bloomberg’s report quoted anonymous sources who said the central bank sent out some questionnaires in July.
The report said that the Monetary Authority asked crypto companies to furnish it with information about their crypto holdings. The companies should also come up with the list of their borrowing and lending partners, the value of what they loaned, as well as tokens they have at stake through DeFi protocols.
The Monetary Authority equally wants to know what goes into companies’ preparation for their launch after they received approval from regulators. This would help the authorities understand any related risks.
This recent demand is coming ahead of changes that are to be implemented by the regulators of all crypto companies. The authority announced in July that additional regulations with regard to trading crypto assets were part of its plans. The bank’s MD, Ravi Menon, gave clues that the regulation’s scope will cover a lot more activities.
Traders Might Also be Tested Before Trading
Just twelve of nearly two hundred applicants have secured the crypto operating license to offer digital payment services in the country. As things stand, the companies are not yet under any liquidity or capital target. They are also not forced by any law in Singapore to safely keep funds and assets belonging to clients from any insolvency.
All these might change in the very near future. A spokesman from the Monetary Authority said to Bloomberg that license applicants are required to notify the Authorities if there is anything that might obstruct their operations. These include issues that might be related to solvency or the ability to carry out their statutory obligations.
A law firm partner, Hagen Rooke, said the authorities in Singapore are considering the need for more regulatory caution because of insolvency issues that held the crypto market in recent times. There are indications that the central bank might ask retailers to pass certain tests before they are permitted to trade.