Singapore’s government plans to expand horizons relating to cryptocurrencies because of recent turmoil in the industry, which has left retail investors penniless.
Singapore is recognising cryptocurrency’s social and economic potential, but for its proper functioning, Singapore will create a positive regulatory environment for its mass adoption.
The government plans to introduce licencing and other proportionate measures to counter the risks involved in cryptocurrencies like money laundering and terror funding.
The managing director of MAS (the monetary authority of Singapore), Mr. Ravi Menon, said in the central bank’s annual report on Tuesday that the proposed steps will be reviewed again in September or October.
Cryptocurrencies are not treated as taxable assets in Singapore, nor are they equivalent to traditional money, but the new rules may treat some cryptocurrencies as securities and capital market products, or DPTs (digital payment tokens), or simply labelled as tokens used for utility purposes.
Singapore has been working on its own cryptocurrency projects for years
Singapore does not support the use of any cryptocurrency, but they started their own “project Ubin” back in November 2016 in collaboration with industry experts to explore the use of blockchain and distributed ledger technology (DLT) for payments.
The project’s primary focus is to facilitate cross-border payments efficiently. Singapore’s central bank (MAS) has also started an initiative titled “Project Dunbar”, which will be a digital banking currency for the central bank.
Currently, cryptocurrencies that have features that suit Singapore’s law are not prohibited in Singapore, but their industry-level users still require a licence.
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— Amal (@maverickmarmot) November 24, 2021