The Payment Services Act – Requirement to Obtain a Legal Opinion on the Tokens Your Platform Supports

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THE PAYMENT SERVICES ACT – REQUIREMENT TO OBTAIN AN OPINION ON THE TOKENS YOUR PLATFORM SUPPORTS

INTRODUCTION

Digital payment token (“DPT”) services (which consist of dealing in DPTs or facilitating the exchange of DPTs)[1] are a newly regulated activity in Singapore.  In Form 1, Question 7.20 requires (the “Assessment Requirement”) each applicant conducting DPT services to: “provide a list of all tokens supported and indicate the applicant’s assessment of the nature of the token.  Attach a legal opinion of the applicant’s assessment”.

The legal opinion is required to include an opinion (the “Assessment”) on whether the token constitutes (1) a DPT and/or (2) a capital markets product under the Securities and Futures Act (the “SFA”).  Tokens that do not constitute a DPT or a capital markets product may constitute “e-money” under the PS Act.

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