The Monetary Authority of Singapore (MAS) has gone against the grain to offer support to ICOs that meet certain basic criteria. The Chief Fintech Officer, Sopnendu Mohanty, has said that any fundraising model which carries the potential to bring improvement to capital markets should be allowed to state its case.
Under the proposition put forward by one of Singapore’s leading civil servants, any ICO can apply for a regulated scrutiny before becoming eligible for a public licence to proceed.
The announcement seems to demonstrative a little bit more initiative than the usual warnings in relation to ICOs that have been emanating from various regulatory authorities around the world in recent months.
The European Union the latest to add its voice to the growing list of sceptics with a patent absence of initiative to address the problem. Through its European Securities and Markets Authorities ESMA, the EU has issued two parallel statements, one targeted at investors and one at ICOs themselves.
Good Cop vs. Bad Cop
In its press release, the European body warns of the risky and volatile nature of the ICO space. A majority of ICOs “fall outside the scope of EU laws and regulations”, they stated, and others need to recognise that they actually qualify as “regulated investment activities”, and as such have been advised to comply with existing rules or risk legal action.
Similar warnings have been issued by Chinese, German, Dutch, US, Canadian and Israeli authorities, each of which has been urging investors to either refrain from the exercise or approach with caution.
As of writing, ICOs have raised over $3.5 billion to date, and whilst still a tiny fraction of the money that changes hands within the investment world more generally, the sheer speed in growth of the ICO phenomenon has been leaving regulators with little choice but to take a stance on this growing debate.
In this context, the apparent pragmatism of the Singaporean approach appears to sit with a minority. On the other hand, Mohanty himself has said that, so far, he has not been privy to any ICO proposition that promises to bring real improvements to current market efficiency.