Singapore vows to be unrelentingly hard on the digital currency sector

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But crypto exchanges including Bybit and Binance have shunned the city-state in recent months as the MAS started rolling out increasingly restrictive rules.

Mr Mohanty was speaking as South Korean prosecutors narrowed in on Singapore-based Terraform Labs, the company behind the collapsed stablecoin terraUSD and its twin token luna.

Lost in private currency

In the aftermath of lunas $US40 billion ($58 billion) wipeout, crypto hedge fund Three Arrows Capital, headquartered in Singapore, was also plunged into a crisis after it failed to meet margin calls.

I think the world at large is lost in private currency, which is causing all this market turmoil, said Mr Mohanty.

He said Singapore had enforced a painfully slow and extremely draconian due diligence process for licensing crypto businesses.

Singapore has approved few applications for a license to operate a crypto business.

Crypto.com, a cryptocurrency trading platform, on Wednesday received in-principle approval to operate. Crypto.com has also received a license in Dubai and plans to launch a cryptocurrency exchange service there.

But Mr Mohantys comments suggest that some crypto businesses may face an uncertain future in Singapore.

This week, the MAS co-launched a center of excellence in the city-state to work on the development of a central bank digital currency, a concept that several countries are exploring to potentially wrest control of online payments from crypto businesses.

Led by software developer Mojaloop and backed by Singapore state fund Temasek, the group hopes to implement the digital currency in a system that enables low-cost international payments.

Mohanty said his best bet was that a digital currency would be integrated into the platform within a few years, adding that it would not be exclusive to Singapore and would be available to other central banks.

We are relentlessly focused on the infrastructure of the future economy, which can be based on a digital asset, he said.

FinancialTimes

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