Singapore Will Not Be Regulating NFTs for Now

The senior minister and minister in charge of the Monetary Authority of Singapore (MAS) said that the regulator cannot possibly regulate every single investment product.
Image source: DepositPhotos

Quick take:

  • The subject of NFTs was discussed in parliament recently.
  • MAS is taking a tech-neutral stance on NFTs.
  • The regulator will keep an eye on the NFT space.

Senior minister and minister in charge of the Monetary Authority of Singapore (MAS), Tharman Shanmugaratnam, said that the country will not be regulating NFTs for now.

In a written reply to a parliamentary question about NFTs, Shanmugaratnam said that the country’s regulatory body “does not and cannot possibly regulate all things or products that people choose to invest their money in”.

Given the fact that NFTs can represent any underlying asset, MAS is taking a “tech-neutral” stance on the subject. 

According to Finder’s global NFT ownership and adoption survey of 28,000 respondents from 20 countries, Singapore ranks 14th in NFT ownership and only two in five Singaporean internet users are aware of NFTs. Finder’s cryptocurrency editor Keegan Francis said that it’s still early days for NFTs in Singapore, but sees an increase in adoption. 

“Singapore’s forecast to have the 7th biggest increase in NFT adoption among the countries surveyed, behind countries like Nigeria, Peru, and Venezuela but ahead of those like Malaysia and Hong Kong. Men are currently the biggest adopters, with 7.4% saying they own NFTs compared to 6.2% of women,” he elaborated.

However, MAS will continue monitoring developments in the NFT space. If it finds that an NFT possesses the characteristics of a capital markets product, then it will be subject to regulatory requirements. 

“Should an NFT be structured to represent rights to a portfolio of listed shares, it will like other collective investment schemes be subject to prospectus requirements, licensing and business conduct requirements,” Shanmugam wrote in his statement.

Shanmugam has also acknowledged the “legal complexities and risks involved in NFTs”, saying “a holder of an NFT with an underlying asset of a digital image should clarify his right of ownership and the legal framework that governs his rights.”

In his statement, the minister urged caution in NFT investments, saying that they are “not suitable for retail investors.” In January, Singapore officials warned against chasing crypto and NFT investments. The country has also recently published guidelines that curb the marketing of crypto assets. 

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