The central bank of Singapore is reportedly assessing whether to increase cryptocurrency regulation as a means of protecting investors.
Monetary Authority of Singapore (MAS) deputy managing director Ong Chong Tee was quoted by Reuters as saying:
“We are assessing if additional regulations are required for investor protection,” – Monetary Authority of Singapore (MAS) deputy managing director Ong Chong Tee
He didn’t elaborate on the details of what sort of additional regulations are being considered.
Wolfie Zhao at Coindesk said that the “comment signals that a new regulatory framework may be imposed on cryptocurrency exchanges in Singapore, and comes as the monetary authority is already paying close attention to domestic cryptocurrency activities.”
According to Reuters, Singapore’s central bank already regulates activities involving virtual currencies if they “pose specific risks”. The country has imposed “anti-money laundering requirements” on firms that provide cryptocurrency services.
Chong Tee’s comment comes not long after Singapore’s deputy prime minister Tharman Shanmugaratnam told parliament last month that there were “no systematic risk concerns” regarding cryptocurrencies for Singapore’s banking sector and the wider economy.
Last year, when Bitcoin soared to a record high of around the $20,000 level, Singapore did warn the public to be cautious about investing in cryptocurrencies.
As Singapore does not regulate virtual currencies it has garnered a reputation of being one of the most business-friendly places for cryptocurrencies and Blockchain technology.
What are cryptocurrencies?
Cryptocurrencies are a kind of digital currency, i.e., they only exist electronically. Cryptocurrencies have no central bank, unlike fiat currencies. Dollars, euros, pounds, yen, yuan, won, and rupees, for example, are fiat currencies.
All cryptocurrencies use a blockchain network. A blockchain is made up of several blocks. Blocks are records, i.e., similar to ledger pages. Every block holds data about all the system’s transactions. They also contain details on the preceding block plus a timestamp.
Unlike centralized systems, blockchains use a system we call distributed ledger technology. In other words, the data, rather than being centralized, is shared across the whole system.