05 Apr Singapore Passes Stricter Law for Crypto Businesses: Report
Singapore’s new crypto law requires crypto businesses based in the city-state operating on foreign soil to comply with anti-money laundering and anti-terrorism measures.
According to the latest report by Bloomberg, the Singapore parliament passed the law on Tuesday, a part of the Financial Services and Markets Bill. It states that domestic virtual asset service providers operating overseas will be required to obtain a license.
So far, such platforms are not regulated for anti-money laundering and countering the financing of terrorism. The move demonstrates that the city-state is stiffening rules for cryptocurrency providers by providing more power to the Monetary Authority of Singapore.
As such, the MAS holds the power to prohibit individuals deemed not suitable for performing key roles, activities, and functions in the financial industry. These will encompass those offering payment services and conducting risk management.
The bill voted by the Parliament also includes a maximum penalty of S$1 million (or $737,050) on financial institutions if they face cyberattacks or their services are hampered.
The move comes on the heels of Singaporean multinational banking and financial services corporation – DBS Bank – announcing that it would not extend its crypto trading services to retail customers anytime soon. The bank withdrew its initial plans citing the regulatory hurdles to enabling digital asset services in the retail sector.
The MAS previously clarified that it does not have any intentions to prohibit Bitcoin and other cryptocurrencies even as some countries, including China, have opted for a blanket ban.
Despite choosing the regulating route, the city-state’s central bank issued guidelines to discourage virtual asset service providers from promoting and advertising cryptocurrencies as it believes engaging with the asset class is highly risky and unsuitable for every investor.
As far as NFTs are concerned, Singapore has taken a tech-neutral stance. As reported earlier, Finance Minister Lawrence Wong revealed that the prevailing income tax rules will apply to the income derived from NFT transactions or trading in it.
However, since Singapore does not have provisions for a capital tax regime, users generating capital gains from the NFT transactions will not be taxable.
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