The Digital Payment Token (DPT) service providers in
Singapore may be required to safely keep customers’ assets under a
statutory trust before the end of the year. This is according to new
measures announced today (Monday) by the country’s financial markets regulator.
The DPT service
providers must separate customer funds from their own, conduct a daily
reconciliation of the assets, and keep proper records, the MAS said. They are
also required to disclose the risks involved in dealing with DPTs to their customers.
However, if the legislative amendments to the Payment
Services Regulations are affected, the DPT service providers will be prohibited from
facilitating lending and staking services for retail investors. According to
the MAS, such activities are risky to retail investors and can only be provided
to institutional clients.
The new measures follow
a public consultation process on
enhancing investor protection and regulating the DPT service providers, which was conducted by the
MAS in October 2022. To have
the new measures implemented, the regulator is now seeking public feedback and
will reportedly publish a guideline on the implementation.
“While the
segregation and custody requirements will minimize the risk of loss of
customers’ assets, consumers may still face significant delays in recovering
their assets in the event of insolvency of the service providers,” the MAS
cautioned.
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