On 1 August 2017, the Monetary Authority of Singapore (MAS) clarified through a media release that an offer or issue of digital tokens would be regulated if these tokens constitute products which are regulated under the Securities and Futures Act (SFA). In doing so, the MAS sent a strong signal that it would focus on the substance of the transaction, even if it is presented within the “cryptocurrency” wrapper.
MAS’ clarification comes in the wake of an increase in the number of initial coin or token offerings (ICOs) in Singapore. In June 2017, it was reported that blockchain startup TenX had raised close to US$80 million from a token sale. A Singapore based startup, Cofound.it, also launched the sale of its own digital currency in May 2017 to fund building of its blockchain-based platform to connect start-ups with investors and experts for funding and advice. Further ICOs are reported to be planned later this year.
This bulletin provides an introduction into ICOs and touches upon some of the market developments and regulatory issues surrounding ICOs and digital tokens. Please click here for more details.