Regulator MAS clarifies Singapore ICO regulation guidelines

The rising popularity of ICOs has attracted a lot of skepticism from governments and regulators. They continually keep placing regulations. In the latest of such controls, regulator MAS clarifies Singapore ICO regulation guidelines

15 November, AtoZForex - A central bank and financial regulator in Singapore outlined that ICOs connected to a startup investment fund would be counted as securities. Monetary Authority of Singapore (MAS) has issued new guidelines on initial coin offerings, outlining how token sales should be regulated under it securities laws.

Singapore ICO regulation guidelines

According to Monetary Authority of Singapore (MAS) statement, it will ‘examine the structure and characteristics’ of a digital token to determine if it is a type of markets products under Securities and Futures Act (SFA) as well as the Financial Advisers Act.

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Similarly, in its document titled ‘A Guide to Digital Token Offerings',  MAS stated:

"MAS may regulate the offers or issues of digital tokens if the digital tokens are capital markets products under the SFA. Capital markets products include any securities, futures contracts and contracts or arrangements for purposes of leveraged foreign exchange trading."

More comments on ICOs 

Indeed, the report provides a selection of case studies, illustrating how the securities laws administered by MAS may apply. In the first case study, a token tied to the computing power-sharing platform wouldn’t constitute securities under the SFA. In the second case, a token connected to a startup investment fund would constitute securities.

However, the guidelines from MAS echoed previous comments that the SFA should regulate ICOs. In August, it announced that it was going to regulate digital tokens or ICOs.

Further, the MAS also said that other Singapore laws may apply to token sales, including the ones that don't come under its direct jurisdiction.

"Digital tokens that perform functions which may not be within MAS' regulatory purview may nonetheless be subject to other legislation for combating money laundering and terrorism financing," the report states.

Additionally, MAS also revealed that it will develop a new payments service framework. The move will cover companies involved in "the dealing or exchange of virtual or fiat currencies."

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