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September 27, 2023
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How Singapore Is Enabling Crypto Boom In South East Asia

Numerous factors have made Singapore a leading cryptocurrency hub in South East Asia. China’s crackdown against cryptocurrency has opened up opportunities for a thriving market for crypto in other countries.

The world is seeing a shift towards Singapore, whether it’s the US taking over crypto leadership with better mining resources, or Singapore welcoming unprotected crypto investors, exchanges, and enthusiasts from China to its crypto-friendly haven.

Singapore has created a crypto-enabling environment. This has led to a boom in the crypto market and an influx of cryptopreneurs from China.

Singapore saw new opportunities created by the closing of crypto entities and migration following the crackdown in China. Here are some examples.

  • The largest Chinese cryptocurrency exchange Huobi has stopped accepting new accounts. It will close all existing accounts by the end the year.
  • Similar measures were taken by other crypto exchanges BitMart, BiKi and others.
  • Coin Market Cap and Coin Gecko, the crypto price comparison websites, are no longer available in China.
  • Some social media crypto communities like Weibo are moving to Twitter, Discord, or Telegram.

According to Peck Shield, the capital outflows from Chinese crypto-exchanges like Huobi and Binance have increased by 62 percent to foreign exchanges. According to Reuters, $28.3 billion in capital made it into foreign exchanges during the first half 2021.

Since May, when China tightened its crypto regulations, Singapore has witnessed the arrival of many Chinese crypto-markets. These include:

  • Binance, a cryptocurrency exchange based in China, was affected.
  • ByBit and Huobi are three other Chinese crypto exchanges that are fully operational in Singapore.
  • Babel Finance, a crypto-finance services company, opened a new Singapore business headquarters in September 2021 amid extreme fear of a ban on crypto.
  • Cobo, which is a cryptocurrency asset management and custodian platform, has also relocated its office to Singapore recently from Beijing.

Singapore’s crypto-friendly regulatory environment makes it a welcoming and attractive place for cryptopreneurs. Here’s how:

  • Singapore, Asia’s financial hub, has adopted fintech and is moving towards trading and ownership of crypto.
  • In 2020, the Monetary Authority of Singapore (MAS) enforced crypto-related legislation under its Payment Services Act.

This regulation is primarily designed to save the users and protect the government from money laundering and terrorist financing threats. This act requires that cryptocurrency exchanges as well as digital token payment systems be licensed.

  • MAS granted licenses to large investors such as DBS Vickers, DBS Bank’s brokerage arm, and Independent Reserve, an Australian crypto exchange, Independent Reserve.
  • MAS also requires crypto firms to share personal data of any person who makes a transaction above a certain limit, also known as travel value.
  • Singapore has established clear regulatory measures for various crypto activities, including payment tokens, securities custody, and crypto fund management.

Lily Z King (the COO) of a Singapore-based crypto assets management company stated that this would allow Chinese crypto enthusiasts to get to know Singapore. She believes South East Asia is a potential new crypto player, and Singapore is enabling crypto boom in the region by providing an enabling environment.

As per a Forkast report, Chia Hock-Lai, cochairman of Blockchain Association Singapore, had gone on record saying that that Singapore offers a favorable environment for crypto research, development and testing. This is made possible by the clear regulations and severe penalties for wrongdoers as well as bad actors.

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