Singapore and Thailand have recently taken steps to regulate the crypto industry, particularly focusing on staking services

Singapore and Thailand have recently taken steps to regulate the crypto industry, particularly focusing on staking services. The Monetary Authority of Singapore (MAS) announced its intention to restrict Digital Payment Token (DPT) service providers from facilitating lending and staking of DPT tokens by retail customers. While MAS has not formally released regulations, it outlined its concerns in a paper published on Monday.

Similarly, Thailand's Securities and Exchange Commission (SEC) declared a ban on lending and staking services, effective from August 30th. The Thai SEC emphasized that it is forbidden to advertise or promote deposit-taking and lending services to the general public.

Both regulatory bodies expressed strong concerns about the potential risks associated with staking and lending services. MAS cited significant consumer harm and highlighted the inherent conflicts of interest for digital asset service providers involved in facilitating these services. Once customer assets are lent or staked, they may no longer be under the control of the customer and may not benefit from the segregation and custody requirements imposed on service providers.

In addition to cracking down on staking, both Singapore and Thailand are requiring better disclosures to inform investors about the risks involved in crypto. The Thai SEC mandates a clearly visible risk disclosure for customers before they can use crypto services. MAS, on the other hand, plans to prevent commingling of customer funds and intends to place customer assets in a trust, ensuring that individual customers' assets are separate from those of the service provider while allowing aggregation into an aggregated pool.

These regulatory actions in Singapore and Thailand aim to enhance investor protection and mitigate potential risks associated with crypto-related activities, particularly in the context of staking services.