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Singapore To Consider New Crypto Rules To Safeguard Users From Crypto Blowups

Written by: Nidhi Kolhapur

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Nidhi Kolhapur

Nidhi is a Certified Digital Marketing Executive and Passionate crypto Journalist covering the world of alternative currencies. She shares the latest and trending news on Cryptocurrency and Blockchain.

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Jul 4, 2022

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Singapore might consider new rules and regulations to protect consumers amid the cryptocurrency market crash and sell-off that resulted in a string of dramatic incidents involving high-profile crypto blowups.

According to a senior government minister, the Monetary Authority of Singapore (MAS) is thinking about adding more restrictions on how the general public can use cryptocurrencies.

The central bank may “place limits on retail participation” and implement regulations on the use of leverage in cryptocurrency transactions, according to Tharman Shanmugaratnam, the minister in charge of MAS, who made the remark in parliament on Monday.

Murali Pillai, a member of parliament, had questioned Shanmugaratnam about whether the MAS planned to impose additional limitations on cryptocurrency trading platforms.

“Since 2017, MAS has consistently warned that cryptocurrencies are not suitable investments for the retail public,” Shanmugaratnam said. “Most cryptocurrencies are subject to sharp speculative price swings. Recent events have vividly demonstrated the risks, with prices of several cryptocurrencies falling drastically.”

As a $2 trillion market selloff ensnared an expanding array of players, the central bank has reiterated this year that cryptocurrencies are not for individual investors.

Both Terraform Labs, whose TerraUSD stablecoin imploded in May, and Three Arrows Capital, the cryptocurrency hedge fund that was forced into liquidation last month after failing to pay creditors, have their headquarters in Singapore.

There is a rise in withdrawals

A rise in withdrawals depleted liquidity, therefore Vauld, a Singapore-based cryptocurrency lender, stated on Monday that it has frozen withdrawals and contacted advisors to investigate a potential restructuring.

According to a blog post published on Monday, the company is looking into possible restructuring possibilities as a way to deal with the issues it is facing. 

CEO Darshan Bathija noted that the business had experienced significant customer withdrawals totaling $198 million since June 12.

The collapse of TerraUSD, Celsius’ withdrawal freeze, and Three Arrows Capital’s loan defaults, as well as the financial difficulties of business partners, have made things difficult for Vauld, he noted.

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Nidhi Kolhapur

Nidhi is a Certified Digital Marketing Executive and Passionate crypto Journalist covering the world of alternative currencies. She shares the latest and trending news on Cryptocurrency and Blockchain.

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