Singapore has warned investors over coin schemes in the past, but the city-state's regulator doesn't want to write off cryptocurrencies altogether.
Three months ago, the Monetary Authority of Singapore (MAS) warned investors that the wave of initial coin offerings, or ICOs, is an opaque and risky bet. On Wednesday, MAS' fintech chief, Sopnendu Mohanty, echoed that warning to «Bloomberg».
«There’s a bunch of ICOs which are selling the Taj Mahal, selling residences on Mars. Be careful of these,» he said.
At the same time, the regulator made it clear that it still wants a piece of the crypto pie, where providers are raising billions from investors by issuing coins based on distributed ledger technology.
ICO Trials
Singapore could trial coin offerings, under certain circumstances – such as when technology that bolsters capital markets underlies the coin, Mohanty argued.
«If we get some use case which we have not seen, then they could come to a regulatory sandbox,» Mohanty told the news agency. Financial regulators in the U.K., U.S., Switzerland and elsewhere have set up «sandboxes», or lightly-regulated settings where fintechs can test their products, often even accepting a small amount of client money.
Mohanty cited smart contracts as another example of a technology that the MAS would consider.
Walking Tightrope
MAS' stance represents a tightrope that larger rival Switzerland is currently walking: foster innovation and attract talents, while keeping regulation apace in order to stamp out abuse.
Mohanty, an 11-year veteran of Citigroup who joined MAS just over two years ago, made very clear that Singapore wants in: «As a regulator, if I can send a signal that we are looking for this bucket, it is empty. Drop an ICO there, we will help you to succeed.»
MAS would be prepared to support an ICO which differentiates itself technologically, and makes capital markets more efficient, he noted.
