The Monetary Authority of Singapore (MAS) is calling for changes in the current regulations which will lead to lowering the market entry requirements for decentralized related exchanges, Bitcoinist reports.
MAS – which is Singapore’s central bank and financial regulator – has issued a consultation paper in which it is reviewing the current regulatory framework which has been in place since 2002. The consultation paper aims at accommodating the numerous changes that have taken place in the financial sector. MAS has invited all the financial institutions and other interested parties to submit their written submissions by June 22nd 2018.
Inadequacy in Regulations
MAS says that the current set of financial regulations are inadequate when it comes to handling some aspects. The regulator claims that a lot has changed in the financial sector due to developments in technology and there are new demands that come with new business models that are pegged on the emerging technology; hence the need for regulatory changes.
The current RMO regime has been in place since 2002, it is timely to review to the regulatory framework for market operators to ensure that it continues to meet the demands of the changing landscape,
– Explains part of the consultative paper.
Accomodation of New Trading Platforms
One of the main changes proposed in the consultative paper is blockchain-based businesses and platform. The paper refers to these new models as emerging new business models in trading platforms, including trading facilities that make use of blockchain technology, or platforms that allow peer-to-peer trading without the involvement of intermediaries.
The primary change that MAS is proposing is to expand the current recognized market operators (RMO) regime from a single tier to three separate tiers, which would better match regulatory requirements to the risks posed by different types of market operators.
At the moment, the MAS regulates market operators under two categories, namely the approved exchanges (AEs) and the recognised market operators (RMOs).
The paper proposes to revise the system by introducing changes to RMO Tier 1 to target market operators with limited access to Singapore-based retail investors, market operators that qualify under the current RMO structure in Tier 2 and market operators that have a significantly smaller scale of business compared with more established operators under the current AE and RMO regime in Tier 3.
In particular, tier 3 of the proposed framework applies to market operators that are significantly smaller than established exchanges and is intended allow them to implement blockchain and P2P technology and roll out services in a supervised environment.
Singapore is one of the Asian countries that has practised a hands-off approach in relations to crypto after harsh policies in countries like Japan, South Korea and China. The new changes are likely to position the country as a favorite destination among blockchain enthusiasts.
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