Singapore is taking the next steps to create the optimum business environment for cryptocurrency and blockchain companies to repeat their success in the traditional Finance sector and become a world center for trafficking of digital assets.
According to the official report
from may 24, 2018, the Central Bank — Monetary authority of Singapore (MAS) is developing amendments to the existing system of regulation of financial markets to facilitate market entry for decentralized cryptocurrency exchanges (DEX).
As stated by MAS, the existing one-tier system «recognized market operator» (RMO) unable to cope with new market demands, particularly with new companies with «innovative technologies». MAS also notes:
«Since the current regulatory regime RMO has existed since 2002, it is time to reconsider the regulatory framework for market operators to continue to meet the demands of a changing industry.»
The message contains a call to the authorities for the development and approval of a new three-tier structure of the RMO, in addition to weakening the requirements of the market access and the creation of recommendations for a «small» exchange platforms. In addition, the document mentions «the observation of the distribution of» P2P exchanges of digital assets on the basis of the blockchain, which ensure the exchange of assets without the involvement of intermediaries.
To increase its appeal to new platforms, the regulator has estimated the size of the market, which usually work decentralized exchange, and proposed another set of laws for their regulation. This step is undoubtedly impressive, because the P2P transfers make up only a small percentage of the world financial market, and the application to them of laws designed to regulate the activities of larger players, and prevents their growth.
According to the statement of MAS, the laws of the third level are developed specifically for exchanges on the basis of the blockchain and their application «must be monitored». MAS says:
«This new legislative level is intended to facilitate the work of the new market participants who are developing solutions for large market operators, and market operators who have been testing their projects and commercially viable, but whose business is unable to meet the requirements of the existing regime RMO».
In accordance with the existing rules of power are shared by all financial exchanges into two broad categories: the RMO and approved exchange (AE). The exchange, falling into the category of AE may Transact billions of dollars a day – these include such sites as the Singapore stock exchange. The first category of the exchange, trading smaller volumes, e.g. platforms offering futures and derivatives. Now, thanks to the new MAS offer will appear and the third category, which will regulate P2P sites based on the blockchain.
Singapore really wants to win the glory of centre for development of cryptocurrency and the blockchain, covering thus almost all the field of Finance. It was recently reported that Singapore and Hong Kong have become centers ICO in Asia due to the continuing migration of South Korean and Chinese companies from their home jurisdiction in connection with the prohibitive policy of the authorities. And it’s not escaped the attention of the regulator in March, the Central Bank of Singapore stated that it is considering new rules on the protection of cryptocurrency investors, and in February announced that it plans to ban cryptocurrency trading.
However, Singapore does not condone unconditional free trade on cryptocurrency markets. Last week the regulator issued warnings to 8 exchanges for the unlicensed trade tokens-stock.