As China cracks down on cryptocurrency, crypto groups gather in Singapore

capital. com team

The crypto dynamics in Asia are changing rapidly, leaving Singapore perhaps as one of the few remaining crypto hubs in the region.

In the last months, China has been toughening its stance against cryptocurrency, often causing major price fluctuations. In June, it caused Bitcoin to dip below $30,000 for the first time since January, after telling the country’s financial giants to stop trading in cryptos.  At the beginning of July, the Chinese dragon roars were heard again with a new crypto crackdown led by the government. More recently, the Chinese authorities punished a company for allegedly being involved in crypto trading activities.  As a result, the country’s persecuted crypto traders are exploring other options. Some of them are moving to Singapore, according to an article by the Financial Times, to join the crypto trading movement.

So far, over 300 crypto companies from different parts of the world have applied for licenses to operate in Singapore, according to Bloomberg, and many have already launched their trading operations in the city-state.

Singapore’s regulatory environment and potential for growth make it a very attractive destination for crypto firms that face regulatory storms elsewhere. Most recently, exchange firm Binance moved its operations to Singapore after it was banned in the UK from carrying out regulated activities. The UK isn’t the only country Binance had regulatory troubles with. It also faced problems in Japan, Germany and Ontario, Canada.  Another firm that moved to the city-state of Singapore is Gemini, a US exchange that was founded by the Winklevoss twins. Chinese billionaire Jihan Wu also established a fintech platform in Singapore in 2019.

How does Singapore roll the carpet for foreign crypto innovators?

The country’s central bank, the Monetary Authority of Singapore (MAS) is making it easier for crypto innovators to establish their businesses in the affluent island nation. While all crypto-exchange companies are required by law to have formal licenses to operate in the country, they can apply to the MAS for an exemption until their license applications are finalised. This allows them to serve local retail and institutional investors before the licenses are finalised. MAS, according to Bloomberg, is applying “robust standards” in assessing all the applications. At the same time, it considers a number of factors such as the applicant’s ability to implement strong measures against illicit flows, and also evaluates the fitness of shareholders and key appointment holders.

MAS plans to closely monitor the cryptocurrency ecosystem to prevent laundering and illegal activities. However, it clearly doesn’t its approach to date suggests it doesn’t want to stifle innovation and entrepreneurship.

Singapore Exchange has added two cryptocurrency indices. At the same time, Singapore-based sovereign wealth fund GIC and state-backed investment company Temasek have spent hundreds of millions of dollars investing in the cryptocurrency sector.

Cryptocurrencies are not yet legal tender in Singapore, like in El Salvador for example, but are instead labelled as goods that can be used for exchange. There are also certain restrictions on the limits of transactions. However, there is appears to be a positive climate that could nurture fintech and crypto innovations. In Singapore, cryptocurrencies are exempt from capital gains taxes.

Singapore as Asia’s New Cryprohub

The crypto dynamics in Asia are changing rapidly, leaving Singapore perhaps as one of the few remaining crypto hubs in the region. Initial adopters of blockchain technology such as China, Hong Kong and South Korea have been changing their outlook on cryptocurrency. Both China and South Korea have clamped down on crypto exchanges in recent months. Hong Kong so far has been considered as one of the most crypto-friendly countries in the world, however, it is vulnerable to the uncertainty that surrounds China.

A recent study by Crypto Head revealed that Singapore currently ranks third behind the US and Cyprus as the most crypto-friendly country in the world.

The article contains market commentary information, it should not be regarded as investment research or investment advice. Past performance is not a reliable indicator for the future.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.25% of retail investor accounts lose money when trading CFD

Crypto Derivatives are not available to Retail clients registered with Capital Com (UK) Ltd.

Capital Com (UK) Limited is registered in England and Wales with company registration number 10506220, authorised and regulated by the Financial Conduct Authority (FCA) under register number 793714.

Capital Com SV Investments Limited is a regulated Cyprus Investment Firm, registration number HE 354252, authorised and regulated by the Cyprus Securities and Exchange Commission under the license number 319/17 (both entities referred together as “we”, “Company” or “”).

Closed joint-stock company “Capital Com Bel” is regulated by National Bank of the Republic of Belarus, registered by Minsk city executive committee 19.03.2019 with company registration number 193225654. Address: 220030, the Republic of Belarus, Minsk, Internatsionalnaya street 36/1, office 823. Certificate of inclusion in the register of forex companies No. 16 dated 16.04.2019.

Read this next

Industry News

Witness the intensifying competition as UF AWARDS MEA 2024 nominations persist!

The countdown is on, with less than two weeks remaining to nominate outstanding brands for this prestigious event, culminating in the highly anticipated ceremony during iFX EXPO Dubai 2024 in January.

Retail FX

Saxo Bank’s FX volumes rise despite overall lackluster turnover

As many currency markets saw a relatively active period in November, Copenhagen-based Saxo Bank reported its monthly metrics, which showed a moderate rebound month-over-month.

Market News

S&P 500 Rally Faces Abrupt Halt: Analysts Assess Market Signals

The S&P 500, a benchmark index tracking the stock performance of 500 of the largest US companies, has ignited a flurry of discussions among financial analysts due to its recent performance.


TraderEvolution at FMLS:23: Andrew Saks on how brokers can go multi-asset

In an insightful interview with FinanceFeeds, Andrew Saks of TraderEvolution Global discussed the industry’s evolution towards multi-asset trading. He highlighted challenges in integrating diverse asset classes and the importance of API connectivity. Andrew also touched on emerging trends in options, futures, and fixed income, underscoring the need for adaptable trading technology in today’s dynamic market.

Market News

Powell’s Pivot Navigating the Dynamics of USD, Interest Rates, and Market Expectations

Federal Reserve Chair Powell has signalled a decisive end to the cycle of interest rate hikes for the USD.

Market News

Inflation Concerns, Policy Divergence, and Market Sentiments in the UK

Amidst the recent global revaluation of inflation, Megan Greene, a steadfast MPC member, advocates for a proactive stance. Addressing concerns in Leeds, she calls for an upward adjustment of the Bank of England’s policy rate, cautioning against the potential risks of a too-conservative approach. Greene questions the assumed restrictiveness in the current monetary stance, suggesting it might be less robust than perceived, especially in scenarios of persistent inflation.

Digital Assets

JPMorgan’s stablecoin ventures into interbank transactions

JPMorgan Chase & Co.’s proprietary digital token, JPM Coin, is set to expand its use case by facilitating interbank transactions on Partior, a blockchain ledger developed in collaboration with DBS Bank, Temasek, and Standard Chartered.

Retail FX

Interactive Brokers’ client base surges past 2.5 million

Interactive Brokers LLC (NASDAQ:IBKR) saw 1.89 million daily average revenue trades, or DARTS, in November 2023 compared to 1.93 million transactions in the prior month. The figure is three percent lower on a yearly basis, and also dropped slightly from a month earlier.

Executive Moves

Andrew Gibson launches TimberFX brokerage brand in Cyprus

After nearly two years at Tavira Securities as Head of Product Development, industry veteran Andrew Gibson is launching a new FX brokerage business based out of Cyprus.