SINGAPORE (Dec 31): In May, the Monetary Authority of Singapore issued a warning against an unnamed company to stop the offering of digital tokens, or its initial coin offering, to investors here. ICOs raise funds in bitcoin or other cryptocurrencies. In a statement, MAS said it had determined that the issuer’s tokens represented equity ownership in a company and were therefore considered securities under the Securities and Futures Act. The offer was being made without a MAS-registered prospectus and therefore contravened the SFA. The regulator said the issuer had returned all the funds received from investors here.

MAS also warned eight digital token exchanges based here not to facilitate trading in digital tokens that were considered securities, or futures contracts, without approval from the authorities. While the regulator acknowledged that it did not “see a need to restrict” ICOs and crypto exchanges if they were bona fide businesses, it added: “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 of the remit of MAS’s rules.”

By the time of MAS’s statement, more than US$20 billion ($27.4 billion) had been raised in ICOs worldwide, since 2014. The bulk of that, or US$14.3 billion, was raised in 2018 alone, according to data from Coindesk. About 8% of that was in Singapore, including by Viola.AI, Lunch Actually and PolicyPal, a digital insurance broker. And, listed companies such as Sakae Holdings were also mulling ICOs as an alternative to raising funds in the equity market.

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