Singapore's retail investors may have to take a risk awareness test to be allowed to trade crypto, in order to ensure that they have sufficient knowledge of the risks involved.
Citing two consultation papers published on Wednesday, the CNA reported that the Monetary Authority of Singapore (MAS) proposed the requirement for aspiring crypto traders to go through a risk awareness assessment as a part of the rules to protect retail customers.
The MAS stated that a number of industry players support some form of assessment and are interested in working together with the regulator to develop a common template so to "facilitate consistency and robustness across the industry."
The MAS was quoted as saying in a press release today that,
Trading in cryptocurrencies is “highly risky and not suitable for the general public.”
That said, the regulator conceded that cryptocurrencies have a role to play in the broader digital asset ecosystem - therefore it “would not be feasible to ban them,” adding:
“Therefore, to reduce the risk to consumers from speculative trading in cryptocurrencies, MAS will require that DPT [digital payment tokens] service providers ensure proper business conduct and adequate risk disclosure.”
There have been further rules proposed in the two published consultation papers.
One is that retail investors will not be allowed to use credit cards or any form of borrowing to trade crypto.
Also, the so-called DPT service providers will not be allowed to offer any incentives (monetary or otherwise) to retail customers upon sign-up, or to encourage referrals of its service.
In general, the proposed regulations meant to protect retail investors cover three main areas, per the report:
The regulator argued that,
“In addition to
Read more on cryptonews.com