Eight cryptocurrency exchanges in Singapore have been warned not to engage in unauthorised trading, specifically, those involving securities or futures contracts.
The Monetary Authority of Singapore (MAS) said it also instructed an Initial Coin Offering (ICO) issuer to cease its offering of digital tokens to investors in the country.
The industry regulator last year had cautioned the public to understand the risks before investing in cryptocurrencies, stressing that these were not recognised as legal tender and functioned in an unregulated environment.
It added that it would step in to regulate the offer or use of digital tokens if these involved products regulated under the country's Securities and Futures Act. The move was prompted by a spate of launches in which ICOs or digital tokens were tapped as a means of raising funds.
In a statement Thursday, MAS said it issued warnings to the eight exchanges not to engage in the trading of securities or futures contracts without its authorisation. They would need to halt the trading of such digital tokens until they had been authorised as an approved exchange or recognised market operator, the regulator said.
It did not reveal the identities of the eight exchanges or ICO issuer, the latter of which offered tokens in exchange for equity ownership and this was considered as securities under the corresponding act. MAS added that the ICO had been made without first registering with the regulator, which breached the local legislation.
The issuer since had stopped the offer and refunded all monies received from local investors. It also was taking actions to comply with the country's regulation.
MAS's assistant managing director for capital markets, Lee Boon Ngiap, said: "The number of digital token exchanges and digital token offerings in Singapore has been increasing. We do not see a need to restrict them if they are bona fide businesses.
"But, if any digital token exchange, issuer, or intermediary breaches our securities laws, MAS will take firm action. The public should be aware that there is no regulatory safeguard if they choose to trade on unregulated digital token exchanges or invest in digital tokens that fall outside the remit of MAS' rules," Lee said.