Singaporean regulators are working with traditional banks to develop uniform screening rules for cryptocurrency prospects.. The collaboration has been underway for the past six months.
According to a Bloomberg report on April 6, The Monetary Authority of Singapore (MAS) has been working alongside law enforcement to help local banks streamline their digital asset service provider account opening procedures. After half a year of cooperation, their results and conclusions for risk management and due diligence will be published in the next two months.
Potential guidelines will also cover stablecoins, non-fungible tokens (NFTs), and transferable gaming or streaming credits. At the same time, banks will reserve the right to make decisions based on the guidelines and their own risk assessment.
As MAS representatives told journalists, currently, there are no rules prohibiting banks from working with digital asset providers:
“Banks make their own determination on whether to start or continue a banking relationship with a customer, balancing between business considerations and business risk tolerance.”
Singapore has established itself as a hub for cryptocurrency companies due to its flexible tax policies, access to diverse tech talent, and convenient location, allowing companies to operate seamlessly within the region in Asian time zones.. However, in late 2022, the MAS proposed to ban digital payment token service providers from offering “any credit facilities” to consumers, including both fiat and cryptocurrencies. Around that time, local cryptocurrency lobbies expressed their opposition to the proposal.
Local authorities are currently conducting an investigation related to the bankruptcy of Terraform Labs and its co-founder Do Kwon. The collapse of the Terra ecosystem caused a major implosion in the digital asset market, with losses of almost $40 billion.
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