Singapore greenlights Coinbase to launch crypto services
Nasdaq-listed crypto exchange operator Coinbase has been handed in-principle approval from Singapore regulators to operate fully regulated cryptocurrency services in the country.
The IPA licence allows the firm to provide digital payment token services under the Major Payment Institution (MPI) licence. Less than 20 MPI-licensed firms are approved by the city-state’s de facto central bank, the Monetary Authority of Singapore (MAS), to offer crypto services.
Using the specific terms of the Singaporean framework, Coinbase has now been approved, in principle, for receipt of a Major Payment Institution Licence that allows it to provide Digital Payment Token Services.
Hassan Ahmed, CEO of Coinbase Singapore and the exchanges’ regional director for Southeast Asia, told Cointelegraph that they “collaborate with industry associations to promote dialogue with policymakers, and ensure balanced regulations, and a pragmatic approach to regulatory framework for digital assets. On the employment side, crypto as an industry is exciting but often confusing, so we are working with career exploration non-profits like advisory.sg to provide guidance to their members.”
Ahmed further elaborated on Coinbase plans to expand in Southeast Asia as it is a “crypto-forward region with a lot of demand for holding and using crypto in markets such as the Philippines and Indonesia, as well as a hotbed of innovation for trends like Web3 gaming such as Vietnam”.
Alongside its US authorisation, Coinbase also holds licenses from Italy, the Netherlands, Ireland and Germany, as well as the UK Financial Conduct Authority to operate a multilateral trading facility (MTF). Additional registrations or license applications are in progress in several major markets, in compliance with local regulations.
Coinbase laid off about 18% of its workforce — or about 1,100 people — earlier this year. CEO and cofounder Brian Armstrong blamed a looming “crypto winter” alongside impending recession as the reasons for making these drastic cuts.
The move comes even as regulators in Singapore said they may implement consumer protections for crypto investors, which could include suitability tests, curbs on leverage trading and credit facilities. The regulator may restrict retail investment in the crypto sector through new consumer protection safeguards.
The city-state’s central bank chief further noted that retail investors have been “irrationally oblivious” about the risks associated with crypto trading. He reiterated the MAS’s view that cryptocurrencies are “not suitable investments for the retail public,” due to their exceptional price volatility.
Singaporean regulators have received 180 licence applications from digital asset providers as the country was seen to be crypto-friendly and has been attracting global firms to set up offices here. This included top crypto exchanges such as Binance and Kraken. Although the MAS has recently given its in-principle approval to several applicants, but over 30 applications were withdrawn after engagement with the agency and two have been rejected.
Singapore’s regulatory regime for exchanges requires them to provide adequate consumer protections and comply with Anti-Money Laundering measures.