Singapore has a supportive cryptocurrency climate as a global leading financial hub. In the realm of fintech, Singapore has supported new businesses. Singapore does so by setting aside funds to grow the sector, under government initiatives to support local firms with a $8.9 million fund for blockchain innovation. Singapore cultivates a balanced environment of government regulations, recognised financial institutions, as well as encouraging entrepreneurship.
To support the cryptocurrency climate, Singapore first ensures that it is a safe space through government regulation. The Monetary Authority of Singapore (MAS) applies stringent regulations on the cryptocurrency space in Singapore. To ensure customer and business security, MAS curates an Investor Alert List (IAL) to show high risk platforms. Binance, which was given the green light in many countries, landed on Singapore’s IAL and has since stopped operating within the country. On the other hand, Crypto.com has been approved, granting it in-principle approval from MAS for its Major Payment Institution License. The approval allows Crypto.com to offer different transactions under the Payment Services Act for residents and customers operating from Singapore. With measures to deter fraud and protect consumers, the standard of cryptocurrency activity is hence raised, ensuring a safe climate for businesses.
Safety and Support
The MAS has also published consultation papers proposing three broad areas to reduce harms and to support stablecoins as a legitimate avenue of asset transaction: Consumer Access, Business Conduct, and Technology Risks.
Consumer Access: Digital Payment Token (DPT) service providers have to analyse risks and make it known to consumers, which allows the latter to make educated choices and ensure safety for cryptocurrency activities.
Business Conduct: Diffusion of any conflict of interest for customers’ assets needs to be done. Furthemore, a channel to register feedback should be created, to uphold ethical business practices in the cryptocurrency sphere.
Technology Risks: Systems must be constantly updated to ensure that there will be no risks if the servers go down, to ensure the collective safety of consumers’ digital assets.
Recognised Financial Institutions
Singapore also has well developed institutions, such as banks with stable liquidity. As an international financial hub, Singapore has state of the art financial organisations and management. DBS bank is now the first bank in Southeast Asia with its digital exchange, using blockchain technology’s tokenisation. Firms also have low corporate taxes compared to other financial hubs globally like big economy players. This gives firms in Singapore an advantage as they can easily earn higher profits. Furthermore, the streamline administrative processes in Singapore make it more straightforward for foreign firms to settle down to start businesses. Firms are also seeking to ride on the blockchain trend, looking to increase productivity and cut costs, making Singapore a prime destination for a global crypto hub.
Singapore has been encouraging entrepreneurship by constantly pushing out new projects such as Project Ubin to use blockchain technology for payments. Project Guardian has also piloted under DBS, JPMorgan and SBI Digital Assets Holdings working with foreign exchange. Furthermore, Project Ubin+ is coming up as an improvement to the previous Project Ubin, beyond local transactions to international transactions.
Singapore is accelerating towards becoming a leading crypto hub by ensuring safety and security in crypto activities. Singapore accommodates firms to smoothly settle in through relative benefits of low corporate taxes, supplemented with the ease of liquidity, and seamless connectivity. Overall, with MAS’s purposeful and strategic decisions, Singapore is leading the world towards a more secure future, building its foundations and expanding its influence as an international hub.