Singapore Expands Crypto Regulation Rules to Cover Custody

Today, the Monetary Authority of Singapore (MAS) revealed plans to widen the scope of payment services regulated under the Payment Services Act and its associated laws by making necessary amendments.

Starting April 4, the amendment takes effect, imposing user protection and financial stability regulations on Digital Payment Token (DPT) service providers. For those engaging in activities within the broader regulatory purview, the Monetary Authority of Singapore (MAS) has announced “transition plans.”

After the amendment takes effect on April 4, businesses have 30 days to inform the regulatory body and six months to apply for a license. Failing to comply with the requirements after this period means these companies must halt their operations.

Significantly, the updated rulebook applies to service providers that help with token transfers or exchanges, regardless of whether they handle the actual cash or coins. Similarly, businesses overseeing international money transfers are now subject to this legislation, even if the money being transferred isn’t received or accepted in their location.

MAS further detailed that implementing these processes would enable them to enforce regulations against money laundering and terrorist financing activities. Angela Ang, TRM Labs’ senior policy advisor, added her perspective.

“Certain amendments have been under development for quite some time now, providing clear regulations for significant aspects of the cryptocurrency industry.”

Authorities have previously unveiled plans to control custody and other crypto transfer facilities. In 2022, Singapore experienced significant setbacks due to failed crypto platforms like FTX Derivatives Exchange, which arose from unchecked crypto trading speculations. As a response, the city-state adjusted its legislation to foster constructive usage of blockchain technology.

The proposed modifications aim to improve payment processing and make it easier for people to buy and sell hard-to-trade assets. At the same time, measures have been put in place by Singapore to prevent regular investors from engaging in cryptocurrency speculation.

Singapore Competes Against Major Crypto Jurisdictions

Singaporе’s crypto sector is growing rapidly with new regulations and offerings, making it a major competitor for digital asset businesses among jurisdictions like Hong Kong and Dubai. These countries boast investor-protecting regulatory frameworks that foster innovation in the crypto space.

Hong Kong is emerging as a preferred destination for cryptocurrency companies due to its well-defined regulatory structure. This attractive legal landscape has piqued the interest of many crypto businesses looking to expand their blockchain and digital asset operations.

For example, OKX, a major global cryptocurrency exchange, is currently applying for a license in Hong Kong. With a proven history of facilitating digital asset trading effectively, OKX aims to offer this expertise to the region.

Just like numerous government programs fostering advanced technologies, Dubai has risen among the leading cities globally for operating a Web3 and AI business.

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2024-04-02 12:51