Latest news with #FinancialServicesandMarketsAct2022
Straits Times
13 hours ago
- Business
- Straits Times
MAS clarifies position on regulation of digital token service providers
MAS said it has set the bar 'high' for licensing, and will 'generally' not issue a licence. PHOTO: ST FILE SINGAPORE - The Monetary Authority of Singapore (MAS) has clarified that digital token service providers offering services solely to customers outside Singapore - whether involving digital payment tokens or capital markets products - will need to be licensed from June 30. The central bank added in its clarification on June 6 that it has set the bar 'high' for licensing, and will 'generally' not issue a licence. 'The money laundering risks are higher in such business models and if their substantive regulated activity is outside of Singapore, MAS is unable to effectively supervise such persons,' it said. Without a licence, existing digital token service providers serving only overseas customers will be required to cease these activities when the regime comes into effect on June 30, said MAS. In its May 30 response to feedback on a consultation paper regarding its proposed regulatory framework for digital token service providers, MAS noted that such providers may be more vulnerable to money laundering and terrorism financing risks due to the internet-based and cross-border nature of their services. This increases the likelihood that they could be misused for illicit purposes, to the detriment of Singapore's reputation. The proposed regulatory framework will come under the Financial Services and Markets Act 2022. MAS also clarified that service providers for digital payment tokens or tokens of capital market products that serve customers in Singapore are already regulated, and there will be no change to what these licensed providers can do. Providers serving customers in Singapore may also offer services to overseas clients, while those dealing with other types of tokens - such as utility or governance tokens - are not subject to licensing or regulation under the new regime and are therefore unaffected. MAS said that it has reached out to persons who, based on information available to them, may be affected by the new regime to clarify its policy position and to discuss their plans for an 'orderly wind-down' of the activity. It added that 'based on available information, we are aware of a very small number of such providers'. Parties who may be affected by the digital token service regime may contact MAS at AMLCFT@ Join ST's Telegram channel and get the latest breaking news delivered to you.
&w=3840&q=100)
Business Standard
4 days ago
- Business
- Business Standard
Singapore court rejects restructuring plan of WazirX parent Zettai
In a major blow to crypto traders on exchange platform WazirX, the Singapore High Court on Wednesday rejected the proposed restructuring plan of WazirX's parent company, nearly a year after an alleged cyber heist resulted in a loss of $235 million in virtual digital assets. The dismissal of parent firm Zettai's scheme of arrangement comes weeks after the company incorporated a subsidiary, Zensui Corporation, in Panama. The court's action was prompted by the company's failure to disclose these incorporation details during the restructuring process, according to people familiar with the matter. Zensui was incorporated on 10 March this year, according to an affidavit submitted to the Singapore Court and reviewed by Business Standard. In addition, the company said Zettai did not intend to obtain a digital token service provider (DTSP) licence in Singapore. It added that the parent or its Panama subsidiary did not intend to apply for registration with India's Financial Intelligence Unit (FIU-IND). The crypto exchange may appeal against the latest order issued by the Singapore Court, a person close to the development said, requesting anonymity. According to Singaporean laws, digital token service providers (DTSPs), subject to a licensing requirement in the country, are required to suspend or cease such business outside the island nation by 30 June 2025. The setback to the company may further stretch the timeline on the distribution of available assets to its creditors. 'Zettai also failed to disclose the incorporation of its subsidiary, Zensui, which was incorporated on 10 March, and an agreement to transfer cryptocurrency assets to Zensui—both of which were not communicated to users or the Court,' said Navodaya Singh Rajpurohit, legal partner, Coinque Consulting and founder, Pravadati Legal. He added that Zettai revealed it does not intend to register with the Financial Intelligence Unit – India, a prerequisite for lawfully distributing cryptocurrency in India. 'These omissions and regulatory non-compliances made the scheme unviable and lacking in transparency,' he said. In the affidavit, the company said the Financial Services and Markets Act 2022 (FSM) did not present any legal or practical impediment to Zettai effecting the first distribution or allowing withdrawals in accordance with the scheme of arrangement—one of the reasons it did not intend to apply for the DTSP licence. 'The Panama subsidiary was the custody of the crypto related to redistribution since the holding was with Singapore. It was an interim since the firm wanted to go to a jurisdiction where it could follow a framework and regulation after 30 June,' a person close to the company said. In April, Zettai said that 93.1 per cent of eligible voting creditors, representing 94.6 per cent in value of claims, voted in favour of the scheme, months after the company proposed restructuring in the Singapore High Court. In total, 1,41,476 scheme creditors, representing $195.65 million in approved claims, cast a vote. Out of the total creditor base, 1,31,659 investors representing $184.99 million voted in favour of the scheme.
