While the current nature and scale of cryptocurrency activities in Singapore "do not pose a significant risk to financial stability", the Monetary Authority of Singapore (MAS) is prepared that the situation could change, Todayonline said in a report.
The financial regular is watching the cyptocurrency space closely "with great interest".
“Some of the best minds in the field are applying their creative energies to make cryptotokens mainstream,” Menon said. This is in addition to the trend that a newer generation of cryptocurrencies are emerging – which are targeted at addressing issues and challenges related to transaction time, energy costs and money laundering risks. “With technology, never say never,” he added.
Menon was speaking at the Money 20/20 Asia conference held in Marina Bay Sands Expo, the report said. He also noted that cryptocurrencies to be put to mainstream use, there needs to be “public trust and acceptance”. Moreover, people would be reluctant to put their faith in a currency that is not backed by a trusted public institution, such as a central bank, which is dedicated to protecting its value.
The central bank's views on the cryptocurrency space are “still evolving”. While MAS does not regulate cryptocurrencies directly, it look at the activities associated with them, the risks, and try to “ensure that (it does) not stifle innovation”.
Menon said, “Regulation should not try to front-run innovation. Take one step or maybe two steps back. Watch closely what is going on… when you haven’t figure out how exactly you are going to define these things, and put in place regulations.”