Singapore’s Cryptocurrency Sector Expected to Grow Further
Singapore has the most liberal and transparent treatment for the cryptocurrency industry in Asia, according to Jarrod Luo, COO and co-founder of Tembusu Systems, a blockchain startup.
Speaking with Deal Street Asia, Luo argued that compared with the likes of Tokyo and Hong Kong, Singapore “has not seen similar levels of regulatory interference into the industry” and currently “maintains the best prospects amongst the three.”
Tokyo’s reaction to the Mt. Gox fiasco, and Hong Kong’s crackdown on MyCoin’s pyramid scheme, have led both jurisdictions to “act in a heavy-handed manner that has stifled further development of the industry,” Luo said.
In the same lines, David Moskowitz, a Singapore-based bitcoin broker, trader and consultant via his firm Coin Republic, believes that Singapore is the most promising country in the region.
“Hong Kong as a financial hub has established itself but is always under the shadow of China,” Moskowitz said in an interview conducted in April. “Japan also has the potential to be a hub however, their government tends to be very slow to react and so far has made many poor statements in regard to Bitcoin.”
“The Singapore government has taken a laissez faire approach to digital currencies and tends to be extremely practical regarding regulations in the area.”
In Asia, Singapore plays a particularly significant role in the development of the digital currency ecosystem, and has benefited from a combination of community enthusiasm, entrepreneurial initiatives and regulatory restraint, according to Antony Lewis, director of itBit Bitcoin Exchange.
In March 2014, the city-state became one of the first countries to take an official regulatory stance on digital currencies when the Monetary Authority of Singapore, the country’s central bank and financial regulatory authority, announced it will regulate “virtual currency” intermediaries to address “potential money laundering and terrorist financial risks.”
However, the authority said it does not consider bitcoin or other digital currencies to be securities or legal tender, implying that digital currencies do not have to comply with Singapore’s Securities and Futures Act or Financial Advisers Act.
“Regulatory clarity has propelled Singapore to the forefront of the digital currency industry” and has helped the local startup scene to flourish, according to Lewis.
Simultaneously, a number of fintech accelerators are settling up in Singapore, including the Startupbootcamp Fintech program, an initiative backed by DBS Bank, MasterCard, Route 66 Ventures, SBT Venture Capital, Infocomm Investments and the Monetary Authority of Singapore itself.
“[The prospects for cryptocurrency in the region] looks interesting and set to grow further. Fintech is such a widely required and integral industry, basically forming the interface between the economy and the movements of value within currencies, commodities and everything that involves value.
“It is an integral part of human economic condition, so if we’re going to see a big boost in intellectual and financial interest, the prospects look interesting, if not rosy.”
Image credit: Antana, Flickr.