FTX saga shines light on ways to improve crypto ecosystem

FTX founder Sam Bankman-Fried, once considered a star in the cryptocurrency world, resigned as the firm's chief executive last week. The troubled cryptocurrency exchange said it was making "every effort to secure all assets" following unauthorised transactions potentially worth hundreds of millions of dollars. AFP
The Monetary Authority of Singapore's position on failed cryptocurrency exchange FTX has raised further questions than it aims to answer. PHOTO: ST FILE
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SINGAPORE - The implosion of cryptocurrency favourite FTX, while painful, has opened a window for improving the way Singapore handles the industry and its players. These improvements could help grow the blockchain and crypto ecosystem over the longer term.

The saga has shone the light on several issues. For instance, the regulator here is right to say that it is “not possible” to stop Singapore users from signing up with overseas cryptocurrency exchanges. One possible solution is to ring-fence local users’ assets and ensure these are backed by reserves, as suggested in the Monetary Authority of Singapore’s (MAS) consultation paper released in late October.

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