Singapore to Regulate Virtual Currency Use
Bitcoin ATMs started to popup in Singapore earlier this month, labeled as vending machines as the country does not recognize virtual currencies neither as securities nor legal tender. But that does not mean there would be no regulation for virtual currencies like Bitcoin. The Monetary Authority of Singapore (MAS) has just released a statement today indicating their plans to regulate virtual currency intermediaries to address potential money laundering and terrorist financing risks.
MAS noted that the anonymous nature of virtual currency will leave them particularly vulnerable to these risks. The statement outlines that any intermediaries that operate virtual currency exchanges will first need to verify the identities of their customers and report any suspicious transactions to the authority. These security measures are similar to those that already exist for money changers and remittance businesses who undertake cash transactions.
The MAS statement also highlight that it does not view virtual currencies as securities or legal tender and, as such, intermediaries and investors involved are not covered under the Securities and Futures Act and the Financial Advisers Act.
“MAS is taking a targeted regulatory approach to virtual currencies to specifically address money laundering and terrorist financing risks. Consumers and businesses should take note of the broader risks that dealing in virtual currencies entails and should exercise the necessary caution,” said Ong Chong Tee, Deputy Managing Director at the Monetary Authority.
This regulation will put Singapore at the forefront of virtual currency regulation. MAS said that they will continue to monitor closely the development of virtual currencies, and is prepared to take additional measures when the need arises.