Singapore Will Require Crypto Firms To Put User Assets

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The central bank in Singapore is about to bring about new measures that would improve the protection of the investor, and the integrity of the market in the crypto industry. On the 3rd of July, the Monetary Authority of Singapore announced certain new requirements for providers of crypto services to hold customer assets in a statutory trust by the end of the year.

The regulator stated that this would heavily mitigate the risk of misuse or loss of the customer assets- whilst facilitating the recovery of customer assets in the event of a DPT service provider’s insolvency. The new custody measures also follow a public consultation on regulatory measures to reduce the risks of the consumers from crypto trading which was launched in December 2022.

Monetary Authority of Singapore Has A Tall Ask For Its Crypto Users

According to the Monetary Authority of Singapore, the consultation did receive significant interest from a wide range of respondents. Central Bank of the country, in their official response, noted that a vast majority of the responders had agreed that the digital payment token service providers should be readily allowed to deposit user assets in the same trust account as the assets of its other users.

The MAS wrote that a few respondents had agreed that the DPTSPs or the digital payment token service providers were to be allowed to deposit the user assets in the same trust account as the assets of the other users. 

Along with certain custody requirements, the Monetary Authority of Singapore also requires the crypto companies to conduct a daily reconciliation of the customer assets- whilst keeping proper books and records. The DPSTPs are also asked to maintain access and operational controls to customers’ DPTs in Singapore- whilst ensuring that the custody function is completely independent of the rest of the business units.