MAS halts Securities Token Offering for regulatory breach

Singapore, SINGAPORE – The Monetary Authority of Singapore (MAS) has warned an initial coin offering (ICO) issuer it should not proceed with its securities token offering in Singapore until it can fully comply with regulatory requirements under the Securities and Futures Act (SFA). The warning was issued on the official MAS website.

According to the MAS announcement, the still unnamed issuer had intended to rely on an exemption under the SFA, which allows an issuer to make an offer of securities to accredited investors without registering a prospectus with MAS. The exemption from prospectus registration is, however, subject to certain conditions, including a requirement not to advertise the offer.

However, the issuer reportedly began advertising their tokens on Linkedin. Although, this wasn’t the point for halt, but regulators have caught the ICO’s advertisement on Linkedin was redirecting these investors and the general public (as a whole) to invest in the ICO – which is not permissible in the exemption clause.

Addressing the issue, Lee Boon Ngiap, Assistant Managing Director (Capital Markets), MAS said in a statement that;

“Where an offer is made to the public, a prospectus is required to ensure that investors are provided with all the information to make informed investment decisions. He continued,

“Some offers may be made without a prospectus if they are limited to a restricted group of persons or to those who have the means to look after their own interests. Such offers are subject to strict conditions such as advertising restrictions. MAS will not hesitate to act if issuers contravene the disclosure requirements under the SFA.”

As a result, MAS ceased the securities offering of the firm. Following such cases, regulatory frameworks on crypto assets may have more stiffen soon in Singapore.