Singapore’s central bank, the Monetary Authority of Singapore (MAS), has said that cryptocurrency tokens do not fall under the definition of securities.
Speaking at CoinDesk’s Consensus Singapore 2018 conference Wednesday, Damien Pang, who heads the MAS’s technology infrastructure office for fintech and innovation, said that after carefully analyzing the nature of tokens, the bank will not regulate them as securities.
This is because utility tokens that are used to enable access to specific services do not share the same characteristics as securities that promise future earnings to investors, Pang explained. If tokens do begin to reflect the nature of securities in the future, Singapore’s central bank will choose to regulate them.
He made a point to highlight that every jurisdiction has a different definition of what defines an asset as a security and that it is to be expected for the US Securities and Exchange Commision to reach a different conclusion than Singapore’s regulators.
By the end of the year, MAS hopes to have enacted a payments service bill that will be applied to tokens that have ”storage and payment values.”
Pang spoke more to the audience about MAS’s 2017 guidelines for cryptocurrency startups, “A Guide to Digital Token Offerings“, which divides tokens into three categories depending on their use case. These comprise of utility tokens, payments tokens, and securities tokens.
While he currently stands by MAS’s stance, he acknowledged that the industry is ever-changing, and depending on the future direction it takes, regulations may be applicable at a later time.
When Pang was asked why the central bank does not call out specific tokens or companies for going against the state law, he replied saying that would quite possibly create an environment detrimental to positive development: “The moment you start naming names, people take it very literally – these are and those are not. But in fact, there are more than 1,000 tokens.”
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