Tuesday, April 5, 2022—Singapore Parliament has passed a crypto law that requires all city-state-based exchanges and firms operating overseas to be licensed by the country’s government.
This new regulation imposed on crypto firms is included in the Financial Services and Markets Act, which strengthens the jurisdiction of the Monetary Authority of Singapore, its crypto regulatory body. At the moment, this is the only regulatory body that is allowed to provide licenses to exchanges and digital asset firms.
In a report posted by Bloomberg, the heightened rules around anti-money laundering and anti-financial terrorism is a step forward in Singapore’s wide-scale crypto adoption.
Aside from the regulation on exchanges, the act passed by the Singapore Parliament also includes the implementation of a higher maximum penalty of US$737,050 on financial institutions, especially crypto firms, if the platform experiences any cyberattacks or any disruptions in the service they provide.
In the past, the crypto industry in Singapore has leniency in regulations for anti-money laundering and terror financing. The new regulation on crypto financial institutions aims to limit digital asset platforms and firms from advertising crypto ads in public spaces and mainstream media.
These guidelines set by the Monetary Authority of Singapore were released in mid-January to stop the crypto firms from trivialising the high risks of trading digital assets as mentioned by the country’s central bank.
In a report by Business Today India, it is said these regulatory clauses can be interpreted as contradicting the city-state’s aim of becoming a hub for Web3 innovations. The previous leniency of the country was done to attract start-ups, venture capitalists and other companies that work in the development of the Web3 space.
With the rise of the new regulations surrounding the crypto industry, this can be seen as a cautious stance from the Singapore government on adopting digital assets reiterated by the news site.
Although, the strengthened controls on cryptocurrency service providers are a move forward in the acceptance of the crypto economy for the long haul in comparison to the reactionary outright ban of China on crypto use.
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