The Monetary Authority of Singapore (MAS) has issued new guidelines discouraging digital payment service (DPT) providers, known as cryptocurrencies, from promoting their services to the general public or downplaying the risky nature of DPT trading in Singapore. The guidelines are effective immediately.
In a press release issued on January 17, 2022, the US Department of State indicated that some DPT service providers have been actively promoting their services through online and physical advertisements or by providing physical automated teller machines (ATMs) in public areas, which may encourage consumers to So. Trade DPTs on a rush without fully understanding the accompanying risks. The association warned that trading DPTs is extremely risky and not suitable for the general public because DPT prices are subject to sharp speculative fluctuations. Accordingly, the general public should not be encouraged to engage in the trade of DPTs.
MAS stated that while it strongly encourages the development of blockchain technology and the innovative application of crypto tokens in value-added use cases, it views cryptocurrency trading as too risky and unsuitable for the general public. Therefore, DPT service providers should not portray DPT trafficking in a way that reduces the high risk of DPT trafficking or engage in marketing activities aimed at the general public.
Who is affected by the new guidelines?
The new guidelines generally apply to DPT providers that have been granted a license under the Payment Services Act (PSA), banks, and all other financial institutions providing DPT services in Singapore, as well as DPT providers currently operating under transition. Exemption. Under the PSA Act, DPT services include buying or selling DPTs or facilitating the exchange of DPTs. When the PSA amendments become effective, the definition of DPT services will be expanded to include the transfer of DPTs, provision of depository services for DPTs, and facilitation of exchange of DPTs without possession of funds or DPT by the DPT service provided.
What do the new guidelines say?
The new guidelines clarify MAS expectations that DPT providers should not engage in marketing or advertising of DPT services:
- in public areas of Singapore (for example, through advertisements on public transport, public transport venues, public websites, social media platforms, broadcasts and publications, or the provision of physical ATMs); or
- By engaging third parties (eg, social media influencers or third party websites) to promote DPT Services to the general public in Singapore. This includes joint promotional campaigns to attract new customers.
DPT Providers may only market or advertise on corporate websites, mobile applications or official social media accounts but must not reduce the risk of trading in a DPT in a manner inconsistent with or inconsistent with the disclosure of risks under the PSA.
The MAS stressed that DPT providers should act with the understanding that trading DPTs is not appropriate for the general public. In light of the rapidly changing landscape of DPT services in Singapore, MAS stated that it will continue to review the provision of DPT services to the public by DPT service providers and may update the guidelines as necessary.