Digital Payment Token (DPT) service providers should not promote their services to the general public in Singapore, according to new guidelines issued by the Monetary Authority of Singapore (MAS).
The new guidelines clarify MAS’ expectations that the service providers for DPT — more commonly known as cryptocurrencies — should not engage in the marketing or advertising of DPT services.
This includes 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 automated teller machines (ATMs).
It also includes advertisement 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 via their own corporate websites, mobile applications or official social media accounts, MAS clarified.
“MAS 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.
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“MAS has observed that some DPT service providers have been actively promoting their services through online and physical advertisements or through the provision of physical ATMs in public areas. This could encourage consumers to trade DPTs on impulse, without fully understanding the attendant risks,” it said in a statement.
MAS assistant managing director of the policy, payments and financial crime group Loo Siew Yee said MAS strongly encourages the development of blockchain technology and innovative application of crypto tokens in value-adding use cases. However, 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,” she added.
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DPT service providers include payment institutions, banks and other financial institutions, as well as applicants under the Payment Services Act (PSA).
Moving forward, 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 monies or DPTs by the DPT service provider, when the amendments to the PSA take effect.
Separately, Spain’s market regular imposed a similar action on the day. The National Securities Markets Commission, or CNMV, says that promotional activity for crypto-assets must also make clear they’re not regulated and may not be appropriate for retail investors, and that they risk losing all their money.
According to a Bloomberg report, providers of crypto services are obliged to inform CNMV of ad campaigns aimed at 100,000 people or more with at least 10 days’ notice. The new rules will take effect on Feb. 17.
