Singapore to ban borrowing for retail investors soon as proposed by the authorities recently. If you are thinking about what pushed Singapore to ban borrowings, then we have the correct answer. So, the city-state decided to impose a ban on borrowing by retail investors in order to be able to prevent crypto purchases using the borrowed funds. This might be a new addition to the Singapore crypto regulation list. They noted that this move was taken to:
“Reduce the risk of consumer harm from cryptocurrency trading and to support the development of stablecoins as a credible medium of exchange in the digital asset ecosystem. These measures will be part of the Payment Services Act.”
Singapore To Ban Borrowing For Crypto
On October 26, 2022, the Monetary Authority of Singapore (MAS) published a release concerning cryptocurrency trading. They noted that they would be regulating the domain further for the betterment of consumers in the state. They stated in the release that:
“Trading in cryptocurrencies (also known as digital payment tokens or DPTs) is highly risky and not suitable for the general public. However, cryptocurrencies play a supporting role in the broader digital asset ecosystem, and it would not be feasible to ban them. Therefore, to reduce the risk to consumers from speculative trading in cryptocurrencies, MAS will require that DPT service providers ensure proper business conduct and adequate risk disclosure.”
There was a list of other crypto regulation methods or policies that could prevent people from being affected by the way this dynamic sector works. Since the combo of MAS and crypto was never normal, we were expecting such updates on Singapore crypto regulation. They also noted that companies would be deterred from utilizing the tokens that have been deposited by investors either for lending or staking in order to earn profits. This crypto framework decision might negatively affect the working of the market.