Nature of Cryptocurrencies
Do cryptocurrencies fall under the scope of the Payment Services Act?
When MAS first drafted the PS Act, there existed first generation digital tokens like Bitcoin and Ether that were used for payments – these were commonly known as “virtual currencies” or “cryptocurrencies”.
MAS brought these cryptocurrencies within scope of the Payment Services Act by defining a digital payment token (DPT) to be any digital representation of value (other than any excluded digital representation of value) that –
(a) is expressed as a unit;
(b) is not denominated in any currency, and is not pegged by its issuer to any currency;
(c) is, or is intended to be, a medium of exchange accepted by the public, or a section of the public, as a payment for goods or services or for the discharge of a debt;
(d) can be transferred, stored or traded electronically; and
(e) satisfies such other characteristics as the Authority may prescribe.
Cryptocurrencies fall under the purview of the Payment Services Act, which has explicitly defined Digital Payment Tokens (DPTs). Though DPTs in themselves are not regulated, if you are engaging in activities involving DPTs, it may fall under the purview of the Payment Services Act.