New Singapore Law Tightens Rules for Crypto Firms
Reportedly, the authorities of Singapore also stated that virtual asset service providers (VASPs) will need to be licensed, regardless of whether the firm is operating overseas or not.
Why Are Singapore’s New Laws So Stringent?
This is not the first time that the city-state has passed a law that has suffocated the digital growth of Singapore. Recently, Singapore has passed a law to prohibit crypto businesses from advertising to the general public.
This was not the scenario in the past when Singapore had a very lenient approach to cryptocurrencies and virtual digital assets. But the city-stated has changed its approach toward cryptocurrency.
The city’s Financial Services and Markets Bill states,
"Entities that conduct the business of providing digital token (DT) services in Singapore are subject to current legislation regardless of where they are established."
The Objective of the New Crypto Law
The aim of the bill is to safeguard Singapore’s reputation for financial probity as it plays a significant role in hosting crypto-related businesses. The bill ensures that cryptocurrency service providers should be regulated, according to the city-state’s authorities as anti-money laundering (AML) and counter-terrorism financing (CFT) will be established.
Penalties Announced by Singapore
The penalties for crypto services providers not following the law will be worth $1 million as part of technology risk management (TRM). This means that the city-state can hold institutions liable for serious cyberattacks or disruption of financial services.
Despite the regulatory shakeups and the Monetary Authority of Singapore (MAS) trying to draw a tighter regulatory framework, Singapore has been attempting to become the global crypto hub. Singapore has also issued licenses to several crypto firms such as Digital Treasures Center, Paxos, Sygnum, and Hodlnaut.