Nature of NFTs
How does MAS view NFTs?
While MAS does not explicitly regulate NFTs, it still considers whether or not it constitutes a capital markets product.
According to MAS (Parliamentary replies)
Last revised 15 February 2022
MAS does not and cannot possibly regulate all things or products that people choose to invest their money in. We consider the substance of an asset when assessing whether a product or activity should come under MAS’ regulatory remit. MAS does not currently regulate NFTs given the nature of their underlying assets, such as the few examples earlier. This is also the stance taken by most other leading jurisdictions.
More fundamentally, with regard to digital tokens such as NFTs, MAS takes a tech-neutral stance and “looks through” to the underlying characteristics of the token to determine if it is to be regulated by MAS. Should an NFT have the characteristics of a capital markets product under the Securities and Futures Act (SFA), it will be subject to MAS’ regulatory requirements. For example, should an NFT be structured to represent rights to a portfolio of listed shares, it will like other collective investment schemes be subject to prospectus requirements, licensing and business conduct requirements.
NFTs are not explicitly regulated by the MAS. Instead, the MAS considers the substance of the NFT and assesses whether an NFT would constitute a capital markets product, and thus come under the Securities and Futures Act (SFA).