Singapore: Closed consultation on proposed amendments to the Payment Services Regulations including investor protection measures for digital payment token services

On 3 August 2023, the Monetary Authority of Singapore (MAS) closed its consultation on the draft amendments to the Payment Services Regulations 2019 including investor protection measures for digital payment token (DPT) services. One of the key changes entails requiring DPT service providers to establish a statutory trust to safeguard customer assets. Additionally, DPT service providers must segregate customer assets from their own holdings and maintain them in trust. To prevent potential conflicts of interest, the custody of assets must be operationally independent from other business functions. Furthermore, DPT service providers are required to offer clear risk disclosures to customers regarding the inherent risks of having their assets held by the provider. In terms of activities, DPT service providers would be prohibited from enabling retail customers to engage in lending and staking activities with DPT tokens. Addressing market integrity concerns, MAS will implement measures to counteract unfair trading practices and instances of market abuse.