Regulators should not legitimize “purely speculative” activity in crypto markets following the collapse of cryptocurrency exchange FTX, said the chairman of the Monetary Authority of Singapore (MAS) at the World Economic Forum’s Davos 2023 conference.

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Fast facts

  • During a panel on banking in today’s uncertain environment, MAS chief Tharman Shanmugaratnam asked: “If we regulate cryptocurrency the same way we regulate banks and insurance companies, will that legitimize something that is inherently and purely speculative and, in fact, slightly crazy?” 
  • “Or are we better off providing ultra clarity to what’s an unregulated market, and if you go in, you go in with your own risk? I lean a bit more to the latter view,” he concluded. 
  • However, Shanmugaratnam added: “Some things are very clear, whether it’s cryptocurrency or traditional finance, you’ve got to regulate for things like money laundering.” 
  • Other panelists agreed that traditional forms of regulation are desperately needed in the cryptocurrency space to protect against money laundering and other illicit activity.
  • According to a report from crypto data aggregator CoinGecko, losses from hacks and exploits in the crypto industry stood at US$2.8 billion last year, the largest amount exploited in a single year since 2013.
  • François Villeroy de Galhau, the Bank of France governor, said it is an “utmost priority” that regulators implement anti-money laundering rules in place for cryptocurrency companies but added that calls for an outright ban on cryptocurrency are “a bit exaggerated.”
  • “It’s not a question of if we have to regulate or not, for sure, we have to regulate… but we have to regulate in a coordinated manner, we have to have international rules,” said Villeroy. 

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