Retail investors should not invest in crypto, says Singapore deputy PM
Blockchain still has a role to play - if properly regulated - says Heng Swee Keat
Singapore’s deputy prime minister Heng Swee Keat has told retail investors not to buy cryptocurrency.
“Retail investors, especially, should steer clear of cryptocurrencies, we can not express this enough,” said Heng, speaking on Tuesday at the Asia Tech x Singapore (ATxSG).
To enforce his point that non-professional investors should steer clear of crypto, Heng cited individuals who had lost large sums of money - sometimes their life savings - as a result of the meltdown of Luna and Terra. The latter is a so-called stablecoin whose worth plummeted to less than 10 percent of its previous value earlier this month.
But while Heng labelled cryptocurrency as “highly risky,” he did acknowledge that digital dollars have the potential to transform finance. The deputy PM said unlocking that potential requires adapting current rules for innovation while addressing risks.
“We remain keen to work with blockchain, and build up trust,” said the deputy prime minister.
The Monetary Authority of Singapore (MAS) has also warned against trading crypto and in January 2022 took action to limit the promotion of digital payment tokens. Singaporean transport hubs, physical ATMs, and social media platforms were therefore made no-crypto-ad zones.
In April, Singapore passed the Financial Services and Markets Bill 2022, which allows higher regulatory scrutiny of digital assets, including those serving foreign markets. At the time, MAS deemed digital token transactions as having inherently higher risks.
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Also speaking at ATxSG was US Secretary of Commerce Gina Raimondo and Singapore Minister for Communications and Information Josephine Teo who discussed their work to develop the Indo-Pacific Economic Framework (IPEF), a new bloc that works on interoperable standards and trade rules among 13 nations on topics ranging from data protection to cybersecurity and beyond.
Raimondo touched on supply chain issues, which she referred to as one of the pillars of the agreement. Data sharing between IPEF allies are hoped to prevent trade bottlenecks through a collaborative mapping of supply chains. Raimondo cited poor US communication with semiconductor packaging facilities in Malaysia as one cause of auto plant shutdowns during the pandemic in Michigan, and the sort of thing the USA hopes IPEF will fix.
“If we had better mapping and data analytics and sharing that wouldn’t have happened,” said Raimondo.
The US Secretary of Commerce also stressed that where supplies are made is also important. “We need all pieces of supply chain on our allied shores to make sure we have resiliency and security,” said Raimondo.
The two government officials also stressed the importance of communication for security, with Raimondo asserting that the allied countries would share information on potential illegal activity, like efforts to circumvent export control including semiconductor provisions sent to Russia.
“The reality is we are staying ahead of it, and the reason is because we have mechanisms for how to share information so if any one country finds out a company is circumventing export controls, then we share that information for enforcement, said Raimondo. ®