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Singapore regulator's clampdown on crypto trading

Singapore, one of the most crypto-friendly countries in the world, has now changed its views regarding the crypto trading industry in the recent scams that have let many lose their life savings.

Photo by Joshua Ang / Unsplash

Singapore’s financial regulator and central bank have pledged to be ‘brutal and unrelenting hard’ on any “Bad Behaviour” from the industry.

As many had called out the government for being ____on the crypto market, the Monetary Authority of Singapore (MAS)’ chief Fintech officer has said:

“Many cryptocurrencies have called us out for not being friendly, my response has been: Friendly for what? Friendly for a real economy or friendly for some unreal economy?” [1]

Introducing Licensing:

Singapore has introduced licensing for crypto firms starting from 2021 and has been stringent on which companies were to get the license.

The worldwide cryptocurrency exchange, the digital currency broker Genesis, and the provider of digital asset solutions Sparrow received preliminary approvals from the Monetary Authority of Singapore (MAS) on June 21. [2]

With this, over the previous two years, 14 licenses and in-principal permissions have been given to DPT service providers, including Stablecoin users, cryptocurrency exchanges, and conventional financial institutions.

In January, cryptocurrency providers were barred from advertising their services in public places as well as even in virtual public spaces such as digital print and in social media. This has caused many cryptocurrency providers major losses in marketing.

The Malaysian Anti-Money Laundering and Combating the Financing of Terrorism Agency (MAS) is also expanding its ability to police cryptocurrency businesses. In April, the regulator passed new rules requiring businesses to obtain licenses and be subject to AML/CFT regulations if they wanted to offer services outside Malaysia.

The losses of the companies:

Due to Singapore’s low taxation and reputation as one of the more crypto-friendly city-states, many cryptocurrencies were established there. However, regulatory tightening shows that it is changing as the nation focuses on its Central Bank Digital Currency (CBDC).

In April, Three Arrows Capital, a hedge fund that has suffered heavy losses in the recent market downturn, said it would leave Singapore for Dubai as the regulatory environment in Singapore sours. Earlier, Binance, the world’s largest crypto exchange by trading volume, shut down its Singapore unit and dropped its application for a license after MAS told it to stop all crypto transfers.[3]