Singapore has disowned the collapsed cryptocurrency project Terraform Labs, saying the platform was not performing activities requiring a license from the MAS and was neither licensed nor exempted from licensing by the regulator. The city-state has also downplayed the impact of the Terraform Labs saga on its financial systems.
Responding to a question by a Member of Parliament, Lawrence Wong, the Deputy Prime Minister and Minister for Finance and Chairman of the MAS, said that the collapse of Terraform Labs sparked concerns about regulatory oversight and investor protection in the cryptocurrency market. The event has prompted Singaporean authorities to reevaluate and reinforce regulations to mitigate risks in the sector.
Enhancing Regulatory Measures
In response to the incident, the MAS has implemented several measures to bolster the regulatory framework for cryptocurrency investment firms operating in Singapore. These measures aim to enhance consumer protection and mitigate risks associated with cryptocurrency trading.
MAS mentioned: "We also remind those who tradecryptocurrencies that the MAS' rules and regulations cannot prevent monetary losses arising from such activities. Consumers must be aware of the risks of doing so and understand that cryptocurrencies are highly volatile and have no intrinsic value."
MAS has introduced new measures focused on retail consumers, aligning with international standards for regulating crypto assets. These measures include assessing customer awareness of risks before granting access to trading, prohibiting incentivized trading offers, and restricting the provision of credit or leverage to consumers.
Additionally, the MAS has imposed business conduct requirements on cryptocurrency platforms to ensure proper segregation and custody of customers' assets, mitigate conflict of interest, and implement risk management processes. These enhanced measures will be implemented in phases commencing this year.
Educational Outreach
MAS emphasized the importance of consumer awareness regarding cryptocurrency trading risks. While regulations can mitigate certain risks, consumers must understand the volatile nature of cryptocurrencies and their lack of intrinsic value. Ultimately, investors bear responsibility for their investment decisions in the crypto market.
Meanwhile, the Securities and Exchange Commission (SEC) of the United States is seeking $5.3 billion from Terraform Labs and its Co-Founder, Do Kwon. This demand, comprising recovery and civil penalties, follows a court ruling that found Terraform and Kwon guilty of fraud.
The SEC's motion, recently filed with the US District Court for the Southern District of New York, outlined the regulator's pursuit of $4.7 billion in disgorgement and prejudgment interest from the bankrupt Terraform Labs. Additionally, the SEC is seeking civil penalties totaling $520 million, with $420 million directed toward Terraform and $100 million toward Kwon.
In response, Terraform and Kwon's legal representatives have proposed significantly lower penalties, suggesting a maximum of $3.5 million for Terraform and $800,000 for Kwon. The court is expected to deliver a verdict on the motion.
This article was written by Jared Kirui at www.financemagnates.com.
You can get bonuses upto $100 FREE BONUS when you:
💰 Install these recommended apps:
💲 SocialGood - 100% Crypto Back on Everyday Shopping
💲 xPortal - The DeFi For The Next Billion
💲 CryptoTab Browser - Lightweight, fast, and ready to mine!
💰 Register on these recommended exchanges:
🟡 Binance🟡 Bitfinex🟡 Bitmart🟡 Bittrex🟡 Bitget
🟡 CoinEx🟡 Crypto.com🟡 Gate.io🟡 Huobi🟡 Kucoin.
Comments