103 Crypto Companies Run Into Regulation Roadblocks in Singapore

The adoption of cryptocurrency in Singapore has been moving in the right direction as its central bank has expressed support. However, the Monetary Authority of Singapore (MAS) is also wary about the necessary risks attached to the emerging technology. This is highlighted by a recent report which found that 103 out of the 170 total companies engaged in digital payment token services were unable to secure licenses following the removal of regulatory exemptions.

Among these is the crypto exchange Bitxmi based in Dubai. “We can’t operate in Singapore,” explained the company’s CEO Sanjay Jain. “We have an office there, but it’s just more or less — there’s one person for our accounting and legal issues.” Bitxmi used to have regulatory exemptions granted by MAS, but it now appears on the financial regulator’s list of entities “no longer exempt pursuant to the Payment Services Regulations.”

While regulation has been particularly strict in Singapore, other crypto exchanges such as Coinbase Singapore and Gemini Trust continue to benefit from the exemption under the Payment Services Act. “Cryptocurrencies could be abused for money laundering, terrorism financing or proliferation financing due to the speed and cross-border nature of the transactions,” noted a representative from MAS.

“Digital payment token service providers in Singapore have to comply with requirements to mitigate such risks, including the need to carry out proper customer due diligence, conduct regular account reviews, and monitor and report suspicious transactions.”

Early last week, Binance’s local branch in the country also announced that it was getting ready to halt its digital payment services to transition into becoming a blockchain innovation hub. By mid-February, Binance.sg’s trading platform will close completely to make way for this decision. “I think this (Binance’s withdrawal of its application) signifies again Singapore’s license regime is quite stringent,” noted Blockchain Association Singapore’s co-chairman Chia Hock Lai.

“Having said that, Binance also stated that Singapore will remain as their blockchain innovation hub, so it is still consistent with the narrative that Singapore is a very important blockchain hub,” he added.

Sources: CoinTelegraph, Reuters