The Cryptocurrency & initial coin offering craze has exerted lots of pressure on regulators all over the world as a surge in the cases of fraud and number of scams keeps on rising in the space. Nations in Asia have showed varied takes on cryptocurrencies with countries like South Korea and China growing amongst the most tight jurisdictions, while a country like Singapore has fronted a more laissez faire approach. The Singapore market has prospered as a good hub for ICO, this is mostly thanks to the country's convenient government support on fintech and good taxation rules. The country's central bank & financial regulators, The M.A.S (Monetary Authority-Singapore) has issued a set of some guidelines on token sales, noting that it “doesn't regulate virtual-currencies; as a matter of fact, they welcome them as a great innovation that will potentially offer reductions in the cost of any financial transactions. In spite of the welcome, the regulator intends to regulate some activities that surround virtual-currencies if the activities pose some specific risks.
Legality and Regulation of Bitcoin And Other Cryptocurrencies in Singapore.
The M.A.S has reiterated that Singapore will be slow in regulating the cryptocurrency market within the country. Noting that the move could actually be perfect in cultivating the growth of the blockchain sector and cryptocurrency in the country, and Singapore as a cryptocurrency hub. M.A.S through its managing director was quoted saying: "As of now, there is no basis for needing to regulate the cryptocurrencies." And even so, M.A.S will remain alert on money laundering and any potential risks that stem from their use.This stance has remained unchanged for a while, when M.A.S said that it would only regulate virtual-currency intermediaries due to the potential of terrorist financing and money laundering. On the above risks, the regulator clarified that Singapore’s anti money laundering (AML) & Countering Financing of Terrorism regulations (CFT) in regards to cryptocurrencies, doesn't separate, be it using fiat currency or virtual-currency. Meaning that the already existing regulations will apply to cryptocurrency transactions. All financial institutions dealing with cryptocurrency will be subjected to this same regulations. In addition to that, the M.A.S director said that the Commercial Affairs Department would be empowered to conduct investigations and prosecute any cases relating to terrorist funding or money laundering.In that announcement, the regulator said that it wouldn't regulate virtual-currencies per se, as it did not consider it as a legal tender or securities.That being an official stand, most industry players pointed out that the current regulations on crowd funding would allow companies to give their own digital-tokens that may be bought using cryptocurrencies, marking a good step for the industry.
The Take Away.
With Singapore increasingly becoming a good destination for cryptocurrency, organizations seeking to escape the regulatory uncertainty associated with some nations like China, The Singaporean authorities are facing lots of scrutiny regarding the country’s regulatory apparatus pertaining the cryptocurrencies. The official stand by the finance ministry has been to look at each situation presented by cryptocurrency case-by-case to assess which ones need to be brought to the regulatory ambit.
(M.A.S-The Monetary Authority of Singapore.)