SINGAPORE Law and Practice Contributed by: Kenneth Pereire and Lin YingXin, KGP Legal LLC
Issuers of regulated stablecoins are required to meet prudential and operational requirements designed to ensure a high degree of price stability. These include maintaining reserve assets that are of high quality and low risk, with reserves always fully backing the stable - coins in circulation. MAS also requires clear segrega - tion of reserve assets from the issuer’s own assets. A key feature of the framework is the requirement that holders of regulated stablecoins must have the right to redeem their stablecoins at par value within a prescribed timeframe. Issuers must make transpar - ent disclosures regarding the composition of reserve assets, redemption mechanics and associated risks, and are subject to regular independent audits to verify compliance. In addition, stablecoin issuers must comply with governance, risk management and technology risk requirements, including AML/CFT controls. Through this framework, MAS seeks to support the responsible development of stablecoins while safeguarding con - sumer interests and maintaining confidence in Singa - pore’s financial system. Open banking in Singapore refers to the use of appli - cation programming interfaces (APIs) to enable the secure sharing of customer-permitted data between banks and third-party service providers. The regula - tions in Singapore support open banking – with the MAS collaborating with the Association of Banks in Singapore to construct non-binding guidelines on developing and adopting open API-based systems, which are crucial for open banking. Moreover, MAS is seen showing active support for Singapore’s transition to open banking by developing APIX, the world’s first cross-border platform for further collaboration within ASEAN itself. 11.2 Concerns Raised by Open Banking In Singapore, the rising prominence of open banking has prompted banks and technology providers to pri - oritise robust measures for data privacy and security. Guided by MAS regulations, these entities are imple - 11. Open Banking 11.1 Regulation of Open Banking
menting advanced technologies like encryption and multi-factor authentication to fortify access controls and protect sensitive information during the transmis - sion and storage phases. Privacy-enhancing systems such as pseudonymisation, anonymisation and data minimisation are also being widely adopted to mitigate risks associated with data breaches, aligning with global principles and local regulations such as PDPA. Moreover, a collaborative industry approach involves regular information sharing, cybersecurity forums and joint initiatives, fostering a collective defence against evolving cyber threats. Continuous investments in cybersecurity infrastructure, employee training and periodic security audits underline the commitment of Singaporean banks and technology providers to secure customer data and maintain the integrity of the open banking ecosystem. 12. Fraud 12.1 Elements of Fraud Fraud in Singapore There are two main categories of fraud in Singapore: • fraud in criminal proceedings; and • fraud in civil proceedings, of which both involve and require the elements and proof of dishonesty/deceit. Fraud in Relation to Financial Services and Fintech Generally, fraud that occurs in relation to financial services and fintech will often fall under the category of fraud in criminal proceedings. Some examples of criminal fraud are identity theft, embezzlement, money laundering and forgery – all of which occur in relation to financial services and fintech. Such offences would render the offender criminally liable of cheating. Pursuant to the nature of the crime, the sections that offenders are likely to be found liable and punishable under the Penal Code 1871 include but are not limited to: • Section 415 – Cheating; • Section 416 – Cheating by personation;
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