MAS

Singapore’s lobbyists oppose proposed blanket ban on lending crypto tokens

The feedback was given in response to a proposed ban by the Monetary Authority of Singapore published back in October.

A crypto lobbying group based in Singapore has voiced its opposition to the proposal from the central bank to prohibit crypto firms from lending crypto tokens.

On Oct. 26, Singapore’s central bank issued consultation papers and proposed banning digital payment token service providers from offering “any credit facility” to consumers, including both fiat and cryptocurrencies. However, the Blockchain Association of Singapore (BAS) believes it may be overly restrictive.

In a feedback document sent to the Monetary Authority of Singapore (MAS), BAS reportedly argued that a blanket ban could push crypto users to pursue lending their tokens to offshore firms that are unregulated. BAS also highlighted that one of the main things attracting users to lending is the interest that they earn, which the association argues is one of the reasons people hold crypto.

In a statement to Bloomberg, BAS board chairman Chia Hock Lai said that instead of a blanket ban, BAS proposes an approach that is more measured and targeted. This includes focusing on educating consumers on the risks of using unregulated entities. The chairman explained:

“The proposed measures, while well-intended, might have unintended consequences if implemented in its entirety, including leading consumers to move towards unregulated service providers.”

In addition, BAS also argued that a complete ban on companies providing incentives to retail customers is “too draconian” and suggested a different way of allowing gifts not connected to financial purchases.

The consultation paper issued by MAS in October 2022 came in the midst of a series of crypto debacles in the country, including those involving the Three Arrows Capital (3AC) hedge fund, crypto platform Vauld and crypto lender Hodlnaut.

In other news, 3AC founders Zhu Su and Kyle Davies were recently subpoenaed via Twitter. The two were ordered to provide documents in their possession, whether the information was with them or a third party.

Blockchain.com gets regulatory nod from Singapore’s central bank

Blockchain.com becomes the second crypto exchange in two days to receive preliminary approval to provide crypto services within the growing crypto hub.

Crypto exchange Blockchain.com has become the latest crypto company to secure preliminary approval from Singapore’s central bank to provide Digital Payment Token services in the city-state.

Blockchain.com’s regulatory approval follows hot on the heels of Coinbase, which revealed it had received the same “in-principle” approval from the Monetary Authority of Singapore (MAS) on Oct. 11.

If officially approved, Blockchain.com would join the likes of companies already licensed for digital Payment Token services including crypto exchanges DBS Vickers and Independent Reserve, digital payment solution provider FOMO Pay, and crypto-friendly payments application Revolut, among others.

Blockchain.com CEO and co-founder Peter Smith commended the country’s regulators for creating a “transparent regulatory process” to foster innovation, stating:

“Blockchain.com commends the Monetary Authority of Singapore on its transparent regulatory process that prioritizes crypto industry oversight while allowing innovation to thrive.”

It is not the first company to make a positive reference to the straightforward regulatory environment in Singapore for crypto companies.

Recently, digital asset platform Anchorage Digital co-founder and president Diogo Mónica pointed to Singapore’s strong regulatory environment and the emergence of a crypto hub as its motivation to choose the city-state as a “jump point” into the Asian markets.

Mónica also highlighted, in contrast, the lack of regulatory clarity in the United States as a major issue, suggesting that even if a company understands what rules govern an asset, it can be difficult to determine which of the 15 regulators they need to engage with.

In August 2021, crypto exchange Independent Reserve was one of the first of 170 global competitors to receive preliminary approval for the DPT license.

CEO Adrian Przelozny also made a positive reference to the transparency of Singapore’s regulatory environment, noting at the time:

“A well-regulated environment will benefit both investors and crypto industry stakeholders. With tailormade rules for the crypto industry, Singapore currently has the clearest and most detailed licencing requirements of any jurisdiction in Asia”

Przelozny suggested the license grants “will continue to put Singapore in pole position as the leading financial hub in Asia.”

Coinbase gains in-principle approval for Singapore crypto license

The country is a key institutional market for the exchange according to the CEO of Coinbase Singapore, who explained it’s also working with local industry groups to improve regulations.

The Singapore-based arm of the United States cryptocurrency exchange Coinbase has received “in-principle approval” to provide crypto services in Singapore from its central bank, the Monetary Authority of Singapore (MAS).

Speaking to Cointelegraph, Hassan Ahmed, CEO of Coinbase Singapore and the exchanges’ regional director for Southeast Asia, said Singapore is a key institutional market for the exchange in Asia due to businesses there continuing to show interest in and gain exposure to crypto.

The city-state also serves as Coinbase’s Asia-Pacific tech hub, with an on-the-ground team of engineers responsible for its international expansion efforts and platform localization, said Ahmed.

Coinbase was already providing services including its institutional platform under an exemption granted by MAS, but Ahmed said it would look to partner with local platforms and expand its fiat capabilities with its new approval to provide Digital Payment Token services.

The exchange says it’s undertaking ongoing work with local Web3 community groups such as the Association of Crypto Currency Enterprises and Start-ups Singapore (ACCESS) and the Singapore Fintech Association (SFA).

Ahmed says it’s working with the local industry in Singapore to ensure fair laws from regulators and provide information to a youth-focused nonprofit, Advisory.sg.

“We collaborate with industry associations to promote dialogue with policymakers, and ensure balanced regulations, and a pragmatic approach to regulatory framework for digital assets,” said Ahmed, adding:

“On the employment side, crypto as an industry is exciting but often confusing, so we are working with career exploration non-profits like advisory.sg to provide guidance to their members.”

Coinbase has seen an interest in expanding through the Asia-Pacific region, with a local entity in Japan since August 2021 and an Oct. 5 expansion of its retail-focused services in Australia.

Ahmed said of Coinbase’s plans to offer services throughout Southeast Asia:

“We see Southeast Asia as a crypto-forward region with a lot of demand for holding and using crypto in markets such as the Philippines and Indonesia, as well as a hotbed of innovation for trends like Web3 gaming such as Vietnam.”

Coinbase’s vice president of international and business development Nana Murugesan previously said to Cointelegraph that the exchange would focus “more towards markets that have [regulatory] clarity” when planning to expand further into Asia.