Circle and Paxos get Singapore payment institution license
Circle and Paxos, the issuers of US dollar-pegged stablecoins, have received in-principle approval from Singapore regulators to operate fully regulated cryptocurrency services in the country.
The IPA licence allows the duo to provide digital payment token services under the Major Payment Institution (MPI) licence. Licensees are required to meet a high bar of compliance requirements to protect consumers.
According to a notice in the government’s official gazette, the new licenses come after a stringent examination and approval process conducted by MAS. Using the specific terms of the Singaporean framework, the two crypto firms have now been approved, in principle, for receipt of a Major Payment Institution Licence that allows them to provide Digital Payment Token Services.
The approvals given to Circle and Paxos take the number of crypto firms that have received the regulatory nod to 20, a fraction of almost 180 applicants. The city-state’s de facto central bank, the Monetary Authority of Singapore (MAS), has been cautious toward cryptocurrencies as it seeks to combat related money laundering and cybercrimes.
Regulators in Singapore said they may implement consumer protections for crypto investors, which could include suitability tests, curbs on leverage trading and credit facilities. They have also repeatedly warned retail investors against putting their money in the market.
Nevertheless, MAS has updated its regulatory framework for crypto-related activities, including digital payments. The country’s Payment Services Act (PSA) covers all crypto businesses and exchanges based in Singapore, bringing all crypto activities under anti-money laundering and counterterrorist-financing rules.
Rich Teo, Co-Founder and CEO, Paxos Asia, commented, “We’re honored to be one of the first US-based blockchain platforms to secure this important license from MAS. We believe blockchain and digital assets will revolutionize finance for everyone around the world, but development of this technology must have clear oversight and consumer protections. We’re excited to have MAS as our regulator. Paxos will safely accelerate consumer adoption of digital assets globally in partnership with the world’s biggest enterprises.”
Paxos is a New York-based exchange and stablecoin issuer, whose status as a licensed financial services company in the US allows it to offer different products, such as crypto trading and settlement, and custody services. Further, the firm can issue tokenized securities and also its customers to access the traditional banking system.
The unique position has enabled Paxos to sign big enterprise clients, such as Interactive Brokers, Revolut, Crédit Suisse, Société Générale and StoneX. It has also joined forces with the world’s most influential crypto exchange, Binance, to secure the NY regulator’s approval to launch a USD-backed stablecoin.
