Crypto exchange Coinbase announced that it has received approval in principle from the Monetary Authority of Singapore (MAS) to provide digital payment token (DPT) services in the island state.
Coinbase gets approval to offer crypto services in Singapore
Coinbase puts another important building block in its growth path as an international financial operator. In recent days, the US cryptocurrency exchange, has been granted a license to operate in Singapore, a country considered highly strategic for the exchange, not just for the Asian market. In fact, the Asian city-state has been Coinbase’s Asia Pacific hub, where the company has long built a presence and where it has employed nearly 100 employees, consisting mainly of product engineers and developers.
Prior to this official approval from the island’s regulator, the exchange founded by Brian Armstrong was already operating there, but on an exempt basis and with the risk of sanctions or charges, as has happened to many cryptocurrency companies and exchanges. Binance, Coinbase’s rival exchange, was banned in 2020 from operating in Britain and Japan in addition to precisely Singapore from February 2022.
Hassan Ahmed, CEO of Coinbase Singapore, commented on the news:
“We 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.”
This authorization has become critical for Coinbase after the new plan passed in Singapore in August that specifically calls for stricter regulations for digital assets and those in the industry to avoid risks to investors from a market like crypto that still suffers from a latency of a precise regulatory framework.
The crypto landscape in Singapore
This step has been necessary since Singapore in recent years has opened its market to the cryptocurrency sector, fleeing from neighboring states such as India and China with much more restrictive legislations toward digital assets, becoming a hub of sorts on the lines of Dubai and the United Arab Emirates.
However in recent months, the MAS, Singapore’s financial regulatory and supervisory body, has adopted a much more careful and stringent policy toward digital asset operators, evidence of which is that out of about 180 applications made by as many companies to operate in the island over the past year and a half, the MAS has reportedly approved only 17, including precisely Coinbase.
According to some the case of the bankruptcy of crypto hedge fund Three Arrows Capital, which was based in Singapore, after the collapse of the Luna ecosystem. Moreover, in recent days precisely with respect to the founder of the Terra ecosystem, also a resident of Singapore, South Korean authorities have issued a detention order, for money laundering, evasion and market disruption.
Hassan Ahmed himself stated:
“We see Singapore as a strategic market and a global hub for Web3 innovation.”
This license obtained by Coinbase is even more valuable after, as mentioned, its rival Binance was forced to shut down its operations on the island in December 2021, as of February this year, precisely because of the lack of this license.
For some time now, both Binance and Coinbase have been on a veritable tour de force trying to obtain licenses to operate in as many countries as possible. Binance this summer obtained licenses to operate in France, Italy, Bahrain and Dubai. Coinbase is focusing heavily on expansion in Europe, aiming to soon obtain licenses in Italy, Spain, France, the Netherlands and Switzerland.
Nana Murugesan, the company’s vice president since January 2022, said:
“When we entered the UK and Europe, this was actually during the last big bear market in 2015-2016. But then when you fast forward to 2017-2018, the U.K. is now a massive part of our business, as is Europe. We entered, we made bets. I’m sure it was probably a tough time. But it’s paid off, significantly.”