No Plans to Impose Cryptocurrency Ban: Singapore Deputy PM
Singapore’s Deputy Prime Minister confirmed that the government’s regulatory plans for cryptocurrencies do not involve an outright ban.
The government of Singapore has announced that it has no plans to ban cryptocurrencies, although it will continue to subject intermediates who buy, sell, or exchange crypto in the country to anti-money laundering regulations, and keep the public informed about the potential risks of investing in cryptocurrencies.
Singapore’s position on the matter was confirmed by Deputy Prime Minister Tharman Shanmugaratnam in a series of answers to questions posed by members of the parliament.
Shanmugaratnam, who also serves as the minister in charge of Singapore’s central bank and financial regulator, the Monetary Authority of Singapore (MAS), confirmed that his department has been carefully analyzing the growing crypto market and the potential risks involved. He stated:
“As of now, there is no strong case to ban cryptocurrency trading here”.
Shanmugaratnam explained that the nature and scale of crypto trading in the country at the moment “does not pose risks to the safety and integrity of our financial system”, since cryptocurrencies are not a widely used method of payment and trading volumes in Singapore are not as high as they are in countries such as the U.S., China and South Korea.
However, he went on to add that since there were risks involved in the usage of cryptocurrencies (such as their usage in illicit activities and the possibility of investors losing all their money), the MAS would continue “subjecting those involved as intermediaries to our anti-money laundering regulations”, and “keep highlighting to Singaporeans that they could lose their shirts when they invest money in cryptocurrencies.”
The MAS only recently issued an advisory for investors, warning them that they might lose all their capital should they choose to dabble in cryptocurrencies.
The deputy PM also went on to emphasize the usefulness of the distributed ledger technology (DLT) underlying cryptocurrencies, claiming it has multiple potential use-cases, owing to which the MAS has been “encouraging a number of blockchain experiments with the financial industry”.
Singapore has established itself as a fintech hub, and the massive potential of DLT is not lost on officials; last month, MAS chief Ravi Menon, expressed the hope that the on-going crypto market crash would not “undermine the much deeper, and more meaningful technology associated with digital currencies and blockchain”.
Overall, Singapore appears to have adopted a balanced approach toward cryptocurrencies. The Deputy PM stated that the MAS is keeping a close eye on the expanding crypto market and the developing regulatory climate in countries such as the U.S., UK, and Europe. It will “stay alert to new risks”, but also encourage innovations which may turn out to be “economically or socially useful”.
Singapore’s moderate stance is in stark contrast to the measures taken by countries such as China and South Korea. China, for example, has adopted a zero-tolerance approach toward cryptocurrencies, banning everything from Bitcoin exchanges and mining to cryptocurrency-related advertisements and websites.