MAS mulls regulating trading of payment token derivatives

Singapore

THE Monetary Authority of Singapore (MAS) is seeking to regulate derivatives of payment tokens such as Bitcoin and Ether by allowing trade only on the four approved exchanges in Singapore.

Approved exchanges include Singapore Exchange Derivatives (SGX Derivatives), Asia Pacific Exchange (APEX) and Ice Futures. MAS will be regulating the activity under the Securities and Futures Act.

SGX however, currently has no plans to launch payment token derivatives, it said in an e-mail to The Business Times.

MAS said there is demand from institutional investors for a regulated product to gain and hedge their exposure to these payment tokens, a point also made by market watchers.

"Payment token derivatives occupy a unique space as a potential asset class for sophisticated players to manage risks and cash flows... These derivatives offer more choices for such players to fulfil investment objectives," noted Associate Professor Lawrence Loh of the NU…