Since Singapore began regulating the cryptocurrency sector earlier this year, about 170 companies have applied for a license to offer “digital payment token services,” which include crypto-related services. However, Nikkei Asia reported that more than 100 companies that applied for such a license have either been turned down or withdrawn their applications.
Central bank fears cryptocurrencies could be abused for money laundering.
Crypto firms that were operating in the country prior to the introduction of the licensing regime were granted exemptions until their license applications had been processed. A spokesperson for the Monetary Authority of Singapore (MAS), the country’s central bank and regulator of the crypto sector, said, “Cryptocurrencies could be abused for money laundering, terrorism financing, or proliferation financing due to the speed and cross-border nature of the transactions.” “Crypto firms 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,” the spokesperson added.
Only three companies are listed as licensed entities on the MAS website.
So far, only three companies are listed as licensed entities on the MAS website: DBS Vickers Securities, a unit of DBS Group Holdings, Southeast Asia’s largest bank; digital payments startup FOMO Pay; and Australia’s Independent Reserve. In November, the central bank had said that Singapore strives to become a global crypto hub. DBS’s head of capital markets and the chairperson of the bank’s crypto exchange said in September: “We are growing very rapidly, and investors are gradually exploring cryptocurrencies and digital assets.” Earlier in September, the MAS had ordered Binance to stop providing crypto services to residents. Subsequently, Binance announced that its Singapore platform would be shutting down last week.