Singapore will issue its first licence for cryptocurrency exchanges in an effort to attract
digital asset groups
Singapore is on the verge of approving a cryptocurrency exchange for the first time.
The Asian state has emerged as a critical pillar for the digital asset business, attempting
to court digital asset groupings.
This plan aims to position the country as the next major global financial powerhouse.
Independent Reserve is a currency exchange based in Australia.
It has gained authorisation from Singapore's central bank to conduct digital payment token
services.
In Singapore, over 170 distinct crypto exchange services sought for licensure.
Independent Reserve was one of the first applicants to obtain formal approval to begin operations
in Singapore.
Among the candidates were well-known companies such as Gemini and Binance.
Singapore is gradually gaining popularity as a location for crypto executives and businesses.
This could be because of the country's permissive regulatory climate.
This comes as financial regulatory authorities around the world conduct extensive examinations
of the crypto ecosystem and digital industries.
The criticism stems from people who view the industry as a conduit for money laundering
and financing terrorists.
Independent Reserve applied for a licence in April of last year, while other groups,
such as Binance, are awaiting final approval.
They are exempt from offering services to institutional and retail investors until then.
Local cryptocurrency specialists have indicated that the community has been anticipating this
development for over a year.
They're now wondering which exchange will receive approval next.
Singapore's economy, which is resource-constrained, is heavily reliant on financial services.
Additionally, it capitalises on its importance as a corporate hub.
This appeal is growing as Hong Kong, Hong Kong's rival financial centre, loses its allure
as a result of China's national security laws.
Now, it appears as though the digital asset business has entered the fray of the competing
cities' competition.
As with mainland China, Hong Kong has a more restrictive stance on bitcoin.
Hong Kong's forthcoming rules will restrict cryptocurrency trading to institutional and
accredited investors.
Meanwhile, Singapore has made it easy for foreign-based cryptocurrency companies to
establish offices and serve domestic investors.
Naturally, they must function within transaction volume constraints.
They announced a payment law in January 2020, allowing businesses to seek for licences.
Almost 90 digital asset enterprises have sought for exemptions and have began operations.
In Europe, the UK's financial regulator has granted licence to a few groups in accordance
with new crypto legislation.
The new legislation are aimed at ensuring that businesses adhere to the country's anti-money
laundering regulations.
According to the Financial Conduct Authority, a sizable proportion of digital asset companies
failed to adhere to its rules.
In June, at least 51 of them withdrew applications.
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