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MAS to take steps on virtual assets supervision

Out-Law News | 29 Oct 2019 | 12:29 pm | 1 min. read

The Monetary Authority of Singapore (MAS) is to increase supervision and surveillance of unlicensed activities involving digital payment tokens.

MAS supervision will increase according to Business Times.

Assistant managing director of the Policy, Payments and Financial Crime Group Loo Siew Yee said that the MAS will use real-time data gathering to accelerate the regulator's assessment of money laundering and terrorism financing risks for licensed companies that work with digital payment tokens, a category which includes bitcoin.

The regulator is currently experimenting with both internal and external technologies to review new data points on public blockchains and other sources. "Such data will provide useful early warning indicators, alongside traditional sources of information such as statutory returns and suspicious transaction reports," Loo said.

The moves will come into force right before the Payment Services Act (PSA) comes into effect by January 2020. The PSA was passed in January 2019 and aims to streamline the regulation of payment services into a single piece of legislation by taking a risk-based, activity-specific approach.

Once the Act comes into force, companies that perform digital payment tokens services will be licensed under the Act and be supervised by MAS's Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT). MAS's next 'supervisory focus' will be on financial institutions' controls for countering the financing of terrorism, according to Loo.

This is the latest in a number of regulatory efforts by MAS in relation to virtual assets. At end of 2018 it published guidelines for intermediaries operating in the cryptocurrency market. The guidelines cover platforms that facilitate primary offers of digital tokens or trade cryptocurrencies and other intermediaries.

In August MAS began to accept applications for new digital bank licences, which includes two types of digital bank licenses and up to five new digital bank licences. MAS said that the entry of new digital players would bolster the development of Singapore's banking system in the digital economy.