The Monetary Authority of Singapore (MAS) issued yesterday (Jan 17) new guidelines on Digital Payment Tokens (DPTs), commonly known as cryptocurrency, in which service providers are not allowed to promote their services to the general public in Singapore.
They “should not” engage in marketing or advertising of DPT services:
- in public areas in Singapore such as through advertisements on public transport, public transport venues, public websites, social media platforms, broadcast and print media, or provision of physical ATMs; or
- through the engagement of third parties, such as social media influencers, to promote DPT services to the general public in Singapore.
DPT service providers can only market or advertise on their own corporate websites, mobile applications or official social media accounts.
DPT services include the buying or selling of DPTs, or facilitating the exchange of DPTs.
According to MAS, the definition of “DPT services” will be expanded to include the transfer of DPTs, provision of custodian wallet services for DPTs, and facilitating the exchange of DPTs without possession of moneys or DPTs by the DPT service provider, when the amendments to the Payment Services Act (PS Act) take effect.
DPT service providers include payment institutions, banks and other financial institutions, as well as applicants under the Act.
Such ads could encourage consumers to trade on impulse
MAS observed that some DPT service providers have been actively promoting their services through online and physical advertisements or through the provision of physical automated teller machines (ATM) in public areas. This could encourage consumers to trade DPTs on impulse, without fully understanding the attendant risks.
It has consistently warned that trading DPTs is highly risky and not suitable for the general public, as the prices of DPTs are subject to sharp speculative swings.
MAS strongly encourages the development of blockchain technology and innovative application of crypto tokens in value-adding use cases. But the trading of cryptocurrencies is highly risky and not suitable for the general public.
DPT service providers should therefore not portray the trading of DPTs in a manner that trivialises the high risks of trading in DPTs, nor engage in marketing activities that target the general public.
– Loo Siew Yee, MAS’ Assistant Managing Director (Policy, Payments and Financial Crime)
For now, the phrasing “should not” in MAS’ new guidelines is very vague and does not firmly illustrate if it’s a legal offence if such providers act otherwise. If so, what would be the legal repercussions?
Regardless, I think MAS is taking the same stance as the whole Covid-19 situation. At the peak of the outbreak, Minister Lawrence Wong, co-chair of the Covid-19 Multi-Ministry Taskforce, had encouraged Singaporeans to refrain from visiting other households.
He did not outrightly say it’s a crime to do so, but by saying this, he’s hoping that Singaporeans will understand that it’s ill-advised to do so and not carry out the act.
After all, this is a mere guideline and not a ruling. As such, it is very likely that the DPT service providers are only encouraged to not advertise or market their services, and it will not be illegal if they commit it.
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Featured Image Credit: Edgar Su via Reuters