MAS grants crypto licenses to DBS and the Australian Stock Exchange; further licenses should be issued www.singaporelawwatch.sg

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Source: Straits Times Post date: October 01, 2021 Author: Joyce Lim

Singapore’s regulations are seen as favorable to crypto and have attracted global cryptocurrency companies to set up offices there.

On Friday, October 1, DBS Bank became the first bank to obtain a license in Singapore to offer digital payment token services, while the Australian cryptocurrency exchange Independent Reserve became the first foreign entity to obtain one.

Industry watchers expect more such licenses under the Payment Services Act (PS Act) to be rolled out in the coming months as the Monetary Authority of Singapore (MAS) has recently given its approval in principle to several candidates.

The first license was issued to Singaporean fintech company Fomo Pay last month.

Regulatory approvals come at a time when cryptocurrency companies are under intense scrutiny from global regulators amid the growing digital asset industry, which is currently valued at $ 1.91 trillion. US dollars (S $ 2.59 trillion).

With the license, DBS Vickers, the brokerage arm of DBS and a member of DBS Digital Exchange (DDEx), will be able to directly help asset managers and businesses trade digital payment tokens through DDEx.

The Singapore Stock Exchange holds a 10 percent stake in DDEx.

DDEx promotes itself as the only full-service, bank-backed digital exchange in the world, offering cryptocurrency trading, asset tokenization and digital custody services.

Ms. Eng-Kwok Seat Moey, Head of Capital Markets at DBS and President of DDEx, told The Straits Times: “We have seen strong demand from our clients since the launch of DDEx in December of last year (2020) . We plan to double the number. participants on DDEx to 1,000, as well as growing that number by 20-30% per year over the next three years, as digital tokens and cryptocurrency trading are increasingly adopted. “

At the end of June, the members-only exchange for businesses, accredited individuals and family offices had around 400 investors and listed its first security token offerings in the form of a $ 15 million digital bond this month. . The total value of traded jumped to around $ 180 million in the second quarter of this year, more than five times the value traded in the previous quarter.

MAS has received 170 license applications from digital payment token service providers, including global crypto exchanges such as Coinbase and Kraken. Thirty requests were withdrawn after engagement with MAS and two were rejected.

Singapore’s regulations are seen as favorable to crypto and have attracted global cryptocurrency companies to set up offices there.

Binance – the world’s largest crypto exchange in terms of transaction volume – has a presence in Singapore through Binance Asia Services, while Chinese company Huobi has its two local subsidiaries, Huobi Asset Investments and Huobi Mall.

Independent Reserve, which was founded in Australia in 2013 and now has over 230,000 users in Australia and New Zealand, chose to open its first overseas office in Singapore in 2019.

Mr. Raks Sondhi, Managing Director of Independent Reserve Singapore, told ST that regulation is a major driver of the cryptocurrency industry as companies seek to be regulated and out of the zone. gray in which many big players operate.

Mr Sondhi said that Independent Reserve Singapore, which provides digital asset exchange and OTC trading services to people and institutions here, currently has three employees and the company is actively hiring as it launches its first marketing campaign here on Friday.

Assistant Professor Ben Charoenwong, from the finance department at the National University of Singapore Business School, said MAS regulation positions Singapore as a potential crypto hub going forward.

“Compared to regulators in China and even the United States, Singapore takes a less strict approach. We can expect large cryptocurrency exchanges and companies to enter Singapore,” Professor Charoenwong said.

Last month, MAS ordered Binance to stop providing payment services to residents of Singapore and also to stop soliciting such activities from residents of Singapore because it is not licensed to do so.

In response, Binance announced Monday, September 27 that it would prevent users in Singapore from buying and trading cryptocurrencies on its main global platform and advised users to stop all associated transactions, remove assets. trustees and redeem the tokens by noon on October 26.

However, users can still create an account and trade on its local platform – Binance.sg – which is allowed to operate under license exemption as its license application is under consideration by MAS.

In Singapore, digital payment token service providers are regulated primarily for the purpose of preventing money laundering and terrorist financing.

MAS had said earlier that the regulation did not extend to consumer protection and MAS does not regulate the digital payment token itself.

Surveys have found that more Singaporeans now own some form of virtual money, while others want to add it to their investment portfolios.

“We have seen institutions like Tesla, family offices and even small and medium-sized businesses investing or adding cryptocurrencies, namely Bitcoin, to their balance sheets,” Sondhi said, adding that his clientele in Singapore had grown. 500% since August. This year.

Ms. Eng-Kwok said: “As the institutional demand for investments in digital assets continues to increase, we have seen a growing interest among asset managers and businesses in accessing payment token services. digital via a trusted platform.

“DBS Vickers, as a member of DDEx, is well positioned to support institutional investors and businesses on this front. “

Source: Straits Times © Singapore Press Holdings Ltd. Permission required for reproduction.

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