MAS warns 8 cryptocurrency exchanges, bars ICO issuer

The Monetary Authority of Singapore said that digital token issuers, intermediaries and platforms that offer, facilitate or trade digital tokens are responsible for ensuring that they comply with all relevant laws.
The Monetary Authority of Singapore said that digital token issuers, intermediaries and platforms that offer, facilitate or trade digital tokens are responsible for ensuring that they comply with all relevant laws.PHOTO: REUTERS

SINGAPORE - The Monetary Authority of Singapore (MAS) warned eight digital token exchanges in Singapore not to allow trading in digital tokens that are securities or futures contracts without MAS's authorisation, it said on Thursday (May 24).

It also warned an initial coin offering (ICO) issuer to stop the offering of its digital tokens in Singapore.

MAS said that if the digital tokens constitute securities or futures contracts, the exchanges must "immediately" cease the trading of such digital tokens until they have been authorised as an approved exchange or recognised market operator by MAS.

MAS has also directed an ICO issuer offering digital tokens to Singapore-based investors to stop doing so. It did not identify the ICO.

"MAS has assessed that the issuer had contravened the Securities and Futures Act (SFA) as its tokens represented equity ownership in a company and therefore would be considered as securities under the SFA," it said.

It added that the offer was made without a MAS-registered prospectus, which is an SFA requirement. The issuer has ceased the offer and has taken remedial actions to comply with MAS' regulations. It has also returned all funds received from Singapore-based investors.

MAS added that digital token issuers, intermediaries and platforms that offer, facilitate or trade digital tokens are responsible for ensuring that they comply with all relevant laws.

In the media statement, Lee Boon Ngiap, assistant managing director (capital markets), MAS, said: "The number of digital token exchanges and digital token offerings in Singapore has been increasing. We do not see a need to restrict them if they are bona fide businesses. But if any digital token exchange, issuer or intermediary breaches our securities laws, MAS will take firm action.

"The public should be aware that there is no regulatory safeguard if they choose to trade on unregulated digital token exchanges or invest in digital tokens that fall outside the remit of MAS' rules."