Cryptocurrency regulation in Singapore – Authorities are setting the record straight

Towards more firmness – The Singapore authorities want to show off inflexible against drifts in the cryptosphere. They sent a strong message to cryptocurrency exchanges and other industry players.

Bad behavior: in Singapore, the regulator shows the fangs

In an interview with the Financial Times, the head of fintech at the Monetary Authority of Singapore (MAS), Sopnendu Mohantylaunched a Warning tough on bad guys in the crypto industry.

According to Sopnendu Mohanty, the regulator will show itself “ brutal and relentlessly harsh to crack down on bad behavior in the industry.

The head of MAS also made other remarks that were far from kind to crypto players.

Indeed, Sopnendu Mohanty had also had strict words, for organizations or people who regret that the regulator does not have an attitude rather crypto-friendly :

Friendly for what? Friendly for a real economy or friendly for an unreal economy? »

And on this point, Sopnendu Mohanty recalled that Singapore has implemented a due diligence process “ painfully slow ” and ” extremely draconian for licensing crypto businesses.

The authorities would have taken these drastic measures, to protect the economy of the country at large.

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SAM victims

This posture of the Singaporean regulator has discouraged from the giants of the cryptosphere to settle or continue their activities in the country.

For exemple, Binance decided earlier this year to close its offices in Singapore. Additionally, the company has abandoned his license application, following the MAS request on the cessation of all its cryptocurrency transfers.

But despite these bitter experiences for crypto businesses, the singaporean regulator does he still have wrong to tighten the screw?

In fact, the current difficulties faced by a major crypto fund like Three Arrows Capital, demonstrates that the answer to such a question is far from simple.

Three Arrows Capital: is regulatory flexibility a poison?

Because of the crypto winter, Three Arrows Capital, which is a Singapore-based fund, was liquidated by five platforms. In addition, it risks taking other companies in the sector in its wake.

Three Arrows Capital announced in April 2022 thathe would leave Singapore for Dubai in order to benefit from a more favorable regulatory environment.

However, the Dubai Financial Services Authority told CoinDesk media that:

Three Arrows Capital is not a DFSA authorized firm and is not regulated by the DFSA »

Three Arrows Capital would not have – in the conditional – therefore not yet left Singapore ? As this fund heads into the abyss, the current toughness of Singaporean regulators can then be interpreted from two angles.

Since the Singaporean authorities were unable to prevent the descent into hell of Three Arrows Capital:

  • Wouldn’t a strict regulatory environment be the solution?
  • Should the authorities be more severe against all companies engaging in any form, in cryptocurrencies?

According to Sopnendu Mohanty, Singapore prefers to favor strict regulation of cryptocurrencies, even if it means penalizing the adoption of digital assets. However, these statements contrast with flexibility towards NFTs adopted by the country.

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