The Kingdom of Singapore reportedly played host to around 40% of all new blockchain businesses launched recently, and most believe this is due to the country’s permissive nature when it comes to financial services businesses.
Blockchain: Searching Everywhere For Friendly Faces
Crypto companies have searched the world for jurisdictions where they might have a chance of not being regulated out of existence. Now the country has created a licensing structure to enable crypto businesses to be even more on the up and up.
Currently, crypto businesses in Singapore fall under a number of different legislative efforts. This is not unlike the United States and other western countries, where multiple agencies can actually claim the right to regulate Bitcoin and other cryptocurrencies.
Singapore’s new Payment Services Act, in some ways, mimics the law by the same name enacted by Malta a few years back. The legislation anticipates increased crypto activity in the country and brings parts of the crypto industry under the purview of an existing regulatory regime.
Of course, crypto assets are not traditional assets by any stretch, so they require special rules of their own.
While the United States and other major countries work to over-regulate efforts like Libra, Singapore, Malta, and other smaller countries manage to attract multi-billion dollar industries interested in working with some degree of regulatory clarity.
America: World Police (Bitcoin Edition)
At one point, things in the United States got bad enough that a number of crypto establishments banned US users altogether, including Binance. In order to do business here, many companies are forced to set up a separate shop here, like Binance and Huobi.
Binance and many others already have offices in Singapore, although they have not spoken publicly on whether or not they’ll be seeking a license. The license is required now, so presumably they will.
A licensing system was enacted in New York, dubbed the BitLicense, that put a great chill on the New York blockchain industry. Over the course of years, the state was only able to approve a handful of applications.
This does not seem to be the intent with the Singapore regulations, which look to make companies feel more at home in the country.
Malta saw dozens of inquiries from exchanges when it launched its own regulatory framework. It seems that all countries really have to do is define their rules, and blockchain companies come from around the world, eager to comply.
In other places, like the United States, compliance is a nightmare, largely because too many agencies are given license over the industry. If a separate division of one agency, or a new agency altogether, was created just for blockchain-based businesses, then you might see a collective sigh of relief from the US blockchain industry.
It has the effect of making the industry a big boy’s game. You don’t want to work in the blockchain industry without access to significant resources, in case you find yourself embroiled in a legal battle. You never know when this or that agency, or this or that jurisdiction, is going to claim rights over the internet’s money.
That won’t be a problem in Singapore. It hasn’t been a problem in other countries for awhile. The question might eventually become whether or not the United States can survive without proper crypto regulation, rather than whether or not it should enact it.
