The Monetary Authority of Singapore (MAS) is considering ways to regulate stablecoins, according to a press release from the agency.
The bank says it is considering the merits of a regulatory regime that focuses on the risks and overall merits of the coins, which are cryptocurrencies tied to the value of other assets, typically major currencies like the US dollar.
According to Bank Minister Tharman Shanmugaratnam, the regulatory efforts come due to recent volatility and turmoil in the crypto space, including the collapse of the TerraUSD coin months ago.
“The recent string of high-profile failures in the cryptocurrency markets, starting with the collapse of the TerraUSD and Luna tokens, illustrates the high risks involved in investing in cryptocurrencies that MAS has repeatedly warned the public about,” Shanmugaratnam said.
And while there is no information on what rules might be coming, Shanmugaratnam said the bank will reveal more in the coming months.
Much has been said about the regulation of stablecoins, with many countries proposing rules in recent months.
See also: Sen. Toomey slams SEC on crypto and calls for bipartisan stablecoin oversight
The U.S. government has spoken about possible regulation, with Senator Pat Toomey criticizing the Securities and Exchange Commission (SEC) for handling crypto, calling it “harmful” to financial innovation and U.S. citizens.
He said it bodes badly that numerous companies working with crypto have collapsed. Take Celsius, for example, which owned $12 billion in assets that had been frozen for weeks.
“These firms have often promised depositors enormous, seemingly unsustainable interest rates, and at least one firm is said to have engaged in risky practices,” he added, saying that the SEC has selectively chosen to apply its position on which crypto assets or – Services fall under their scope.
Toomey said the SEC should have listened to calls for guidance on applying securities laws to digital assets — steps that could have prevented losses.
See also: Robinhood Crypto Unit Faces $30M Fine for AML Cybersecurity Breaches
Meanwhile, in other crypto news, the New York State Department of Financial Services (NYDFS) has fined online broker Robinhood’s cryptocurrency trading unit $30 million for alleged violations of anti-money laundering (AML) regulations and of cybersecurity, The Wall Street Journal (WSJ) reported Tuesday (Aug. 2).
The New York State Financial Services Commission’s first crypto enforcement action said Robinhood Crypto “failed to maintain and certify compliant anti-money laundering and cybersecurity programs,” according to the report. Robinhood must also engage an independent consultant to assess its compliance.
According to the NYDFS regulatory review and a later enforcement investigation, Robinhood Crypto was found to have generated “significant errors.”