More local consumer protection rules for retail crypto investors on the way

Digital asset firms that are licensed in Singapore will have to comply with rules that protect retail consumers in two phases, in October and in June 2025.

- Claire Huang

Rules to do with ring-fencing customers' assets, a crypto firm's disclosures and risk management controls will take effect on Oct 4.

Measures that centre on the assessment of a retail investor's risk awareness will kick in on June 19, 2025.

In the second phase, licensed crypto firms, also defined as digital payment token (DPT) service providers under the law, are not allowed to offer incentives to get retail customers to sign up with them.

As prices of cryptocurrencies are highly volatile, the use of any form of credit, leverage or instrument such as derivatives contracts that reference cryptocurrencies as the underlying assets are not allowed with retail investors.

These measures, previously outlined by the Monetary Authority of Singapore (MAS), will take effect in June 2025.

In a note issued on Sept 30, law firm Baker McKenzie Wong and Leow said the additional consumer access rules are to be applied regardless of a customer's residency.