Central Bank of Singapore: Cryptocurrencies are the source of the problem of the digital asset ecosystem

The head of the Monetary Authority of Singapore (MAS) said that the market situation is forcing the authorities to tighten regulation of cryptocurrencies and support the development of the blockchain.

MAS CEO Ravi Menon Ravi Menon revealed at the Green Shoots seminar that the regulator intends to limit speculative trading in cryptocurrencies while promoting digital assets. At the same time, Menon does not believe that the position of the Central Bank of Singapore is controversial.

The head of MAS expressed concern: while the digital asset ecosystem uses blockchain and tokenization to create “something of value, store and exchange data”, cryptocurrency is used for “active speculation”. The official added that the prices of cryptocurrencies “have no economic value”:

“Cryptocurrencies have a life of their own outside of the distributed ledger, and this is the source of the crypto world’s problems.”

Menon stated that instead of supporting cryptocurrencies, MAS will focus on actively promoting the digital asset ecosystem, including the tokenization of financial assets such as cash and bonds, real assets (art and property) and intangibles (carbon credits and computing resources):

“I hope I was able to explain that supporting MAS operations with digital assets and pursuing cryptocurrency speculation is one position. Both initiatives do not contradict each other. It is truly a synergistic and holistic approach to developing Singapore as an innovative and responsible global digital asset hub.”

Last week, ahead of the introduction of new legislation to address liquidity concerns, MAS began conducting a massive review of crypto companies for financial stability and their ties to other legal entities.