- Only three companies have operating licenses issued by the city-state regulator.
- Around 100 crypto exchanges are operating with an exemption while they await their decision from the government, which is currently maintaining firm control over the crypto industry in Singapore.
- The regulator previously ordered Binance to cease offering its services, and warned users not to trade on the platform.
Cryptocurrency exchanges are competing with each other for a slice of the pie in the Singapore market, even though digital assets are strictly controlled by the financial regulator and sites like Binance.com, it seems set to suffer increasing government repression.
The city-state has become a major financial center through which cryptocurrency providers see opportunity to expand into the rest of Southeast Asia.
Among the companies that are fighting for an operating license issued by the Monetary Authority of Singapore (MAS) are Matrixport, Cabital and Luno, according to Japan’s Asia Nikkei. However, the odds of obtaining a license from the state appear to be slim.
The permits in question are not easy to obtain due to the extreme zeal of the authorities in regards to keeping strict control over the authorizing of operations involving crypto assets.
Luno, a London-based exchange, offers users buying, selling and storing services for products related to Bitcoin and Ethereum. Last October, the platform launched funds from a transfer system between bank accounts and cryptocurrency wallets.
Investors in Singapore can transfer Singapore dollars from their local bank account to wallets free of charge. Luno has highlighted its hopes to obtain a license from the financial regulator in order to begin offering its services fully.
The company has been enabled to operate in the city state temporarily due to an exemption granted by the regulator while its application is processed.
"Singapore has always been one of Luno's key markets, given its reputation as a global financial center with a progressive business environment," the company’s Singapore Branch Manager Sherry Goh told Asia Nikkei.
She added that:
"The Monetary Authority of Singapore has proven to be forward-looking, progressive and open-minded, which is something we really appreciate as such a regulatory approach provides great support for our sector - one that is rapidly evolving." Despite the Singaporean regulator’s reluctance to grant operating licenses, many crypto exchanges consider the regulator to actually be supportive of the industry, at least in comparison to the strict positions taken by other governments in the region, including China, Japan, Thailand and Indonesia.
On The Flipside
- Singapore has not yet banned cryptocurrencies, on the contrary, it is assessing the feasibility of allowing crypto projects to operate in the citystate, but has decided to maintain firm control over the operations of crypto exchanges to ensure that the sector doesn’t get out of hand.
Binance Singapore, which is owned by parent company Binance.com and operates as an independent unit, has applied to MAS for an operating license. The company has been operating with an exemption similar to that of Luno and other crypto platforms.
Why You Should Care?
- Singapore’s central bank has stepped up its oversight of Binance, as have regulators in Hong Kong and the United Kingdom.
- The growth of the platform at a global level has led governments to increase controls over their activities and businesses.
"The positives of this approach are several - it is easier for the regulator to control the activity of a few licensed crypto platforms, [with] better enforcement of know-your-client and anti-money-laundering procedures," he added.
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