MAS seeks Ripple’s feedback before concluding new stablecoins regulations to ensure value stability.
The Singaporean regulatory authority recently unveiled the details of its new regulation targeted at the value stability of stablecoins. Building up to this point, the Monetary Authority of Singapore (MAS) sought inputs from 39 prominent firms.
The questionnaire respondents included blockchain-based businesses Ripple Labs and Circle Internet Financial. The well-known XRP influencer Crypto Eri shared details about the development with the crypto community.
👀Monetary Authority of Singapore finalized STABLECOIN reg. framework
Comments from @Ripple @SBI_DAH @circle published👇
Framework aims to "use of stablecoins as a credible digital medium of exchange and as a bridge between the fiat and digital asset ecosystems "… pic.twitter.com/bcjr2dijGQ
— 🌸Crypto Eri 🪝Carpe Diem (@sentosumosaba) August 20, 2023
Ripple Labs Comments
The MAS asked Ripple about its view concerning the adequacy of the single-currency stablecoins (SCS) regulations. It also inquired about limiting its regulatory tentacles to SCS issued within Singapore or whether to include those issued outside.
The SCS is a stablecoin pegged in a one-to-one ratio to the Singapore Dollar.
Ripple responded that it supports the idea of the MAS focusing on SCS issued within the country. However, Ripple noted that the SCS market outside Singapore may bourgeon and pose systematic risks without regulations.
Given this outlook, Ripple Labs urged the MAS to exert regulatory guidelines for SCS on all applicable fronts. According to the firm, the SCS regulation should align with the principle of ‘same risk, same activity, same treatment.’
Furthermore, the MAS sought Ripple’s view on creating extra regulation for payment service of SCS issuance. Ripple agreed with this proposition. It added that it should apply to all stakeholders in SCS minting and burning.
Concerning the view of a single label for SCS, regardless of whether it comes from a bank or non-bank institution, Ripple remarked:
“Ripple is supportive of the MAS’ proposal to introduce a single label for SCS issued by banks and non-bank entities, which are regulated for an SCS issuance service under the PS Act, and for intermediaries to also use the same term in their disclosures where they offer such SCS to differentiate them from other stablecoins offered.”
Ripple argued that it is better to maintain unity in name, regardless of the issuer. The single label Ripple suggested is “regulated stablecoin.” According to the blockchain firm, such nomenclature will boost users’ confidence that they are dealing with a product under oversight.
Circle Internet Financial, the USDC stablecoin issuer, shared similar sentiments with Ripple. Circle supported the MAS in creating additional regulations for SCS issuers.
Additionally, the MAS sought comments on the appropriateness of the proposed reserve requirement for SCS. Circle expressed that the reserve asset requirements are adequate.