Singapore propose a new law regulating the crypto industry

The Monetary Authority of Singapore is pushing for a new law that seeks to regulate transactions with crypto assets to all local companies that operate in the city-state, as well as abroad.

The Monetary Authority of Singapore announced a new law that will regulate cryptocurrency trading framed in FATF standards.

Under the name ¨ New Omnibus Law for the Financial Sector¨ the Monetary Authority of Singapore pretends to expand and change the regulatory framework that rules the sector in the city-state.

¨The provisions of the New Law will broaden the range of existing legislation, which already regulates most of the token services provided in Singapore, states the official MAS document.

The new law will include all local companies operating in the country, as well as those operating abroad.

The main objective of the regulation is to filter those companies that do not fulfill with the requirements established in the standards of the Financial Action Task Force.

Consequently, the local body intends to prohibit any company that is not framed within the new law from operating in Singapore.

New regulatory framework will be consulted

Thus, the Monetary Authority of Singapore prepared a consultation document, with the intention of presenting the ¨New Omnibus Law for the Financial Sector¨.

The document is 99 pages long and will be available for Singapore citizens until August 20th of this year.

In this way, citizens will be able to include all the opinions and considerations that they believe appropriate and necessary, so that they are taken into account when carrying out the final law.

Furthermore, the Monetary Authority of Singapore will be able to poll public opinion on the initiative.

In addition to this new law, Singapore is developing a multi-currency payment system on blockchain in cooperation with the firm Temasek.

At the same time, it also studies the possibilities and advantages of issuing a digital currency run by the Monetary Authority of Singapore itself.

Monetary Authority of Singapore is considering reducing support measures

The Singapore government affirmed that the support measures cannot be maintained indefinitely and warned that it is necessary to evaluate new alternatives that allow companies and citizens to stay afloat.

Monetary Authority of Singapore (MAS) and financial institutions are evaluating a plan to reduce support measures for companies and citizens.

Ravi Menon, MAS’ director announced that they are working with banks on how to separate companies and citizens from the support measures implemented by the government.

Menon pointed out that since the beginning of the pandemic the Central Bank has worked with the financial industry in the implementation of support measures, that they have already done their part.

“I don’t think we can continue these supports indefinitely, because the longer you continue them, the more risk some of these borrowers are in terms of repayment,” he added.

Other alternatives need to be considered!

He emphasized that, it is time to consider other alternatives that allow companies and citizens to stay afloat in the midst of the crisis generated by the Covid-19.

The MAS’ director stated that a balance needs to be achieve to ensure that most debtors can repay their loans to financial institutions.

Since March 31, the Monetary Authority of Singapore has been working on the implementation of a series of support measures for companies and citizens.

Scope of support measures

According to Menon, the payments of 34 thousand mortgage loans have been deferred until December 31.

Principal and interest payments on more than 2,100 renovation and education loans have also been deferred.

More than 6,200 applications to convert outstanding credit cards and unsecured debt into term loans at lower interest rates were approved

Nearly 25,000 life and health insurance policies have deferred their premiums while maintaining coverage.

About 600 individual general insurance policies, such as for vehicles policies, are under flexible installment payment plans.

More than 240 PYME applications for flexible payment plans of general insurance were also approved. The postponement of guaranteed loan payments from more than 5,300 PYME was approved.

Ubin project: a multi-currency payment network based on Blockchain

Monetary Authority of Singapore (MAS) announced the launch of the Ubin Project, a multi-currency payment network based on blockchain technology.

A report from the agency states that the project was validated with over 40 financial and non-financial companies to prove its commercial capacity.

Its potential uses include: faster and lower cost cross-border transactions, currency exchanges, smart contracts for deposit and commerce.

The Monetary Authority of Singapore claims that Ubin Project can level the way to build better cross-border payment networks with strategic alliances between central banks and other financial entities.

While Temasek agents claim that the project will allow better adaptation of Blockchain technology in the financial sector.

“We will support the commercialization efforts of the Ubin Project, in order to promote a better adaptation to blockchain technology” said Chia Song Hwee, executive director of Temasek.

Ubin Project Phases

It is an initiative born in 2016, developed by Temasek and J.P Morgan, began its testing phase last year.

First and second phase: they were in charge of develop technological competences for a national payment network.

Third and fourth phase: was focused on the internal operability of blockchain-based networks for Delivery-versus-Payment (DvP) and Cross-Border-Payment-versus-Payment (PvP), which were in charge of prove the viability of the project.

Fifth phase: was responsible of proving the value, including how to improve settlement efficiency.

The Ubin project is projected as a bridge that help transactions with central banks and other users in the financial industry, allowing the creation of a better technological infrastructure to expand the network for cross-border payments.