The regulatory framework for crypto businesses and exchanges in Singapore has been updated by the Monetary Authority of Singapore (MAS).
The announcement was made on Tuesday. The Payment Services Act 2019 (PSA) puts Digital Payment Token (DPT) services under the anti-money laundering (AML) and counter-terrorist-financing (CTF) current rules. This means local crypto business need to register and apply for a license in order to function.
The PSA is quite similar with the Fifth European Anti-Money Laundering Directive (AMLD5) that took effect on January 10.
FATF Seems to Dictate the Rules
As far crypto regulations and their implementation goes, it looks like countries from all over the world are doing what the Financial Action Task Force (FATF) recommended back in October 2018 and June 2019. This means data on both the originators and beneficiaries of crypto transactions are to be transmitted, as the FATF “travel rule” requires. This is what the AML Working Group at Global Digital Finance’s head, Malcolm Wright, had to say about MAS and FATF:
“The interesting thing about the Monetary Authority of Singapore is that, in a sense, it’s FATF-ready.”
MAS Had a Consultation Before Christmas
Before Christmas 2019, MAS had a consultation and added a few amendments on digital assets to the PSA. In order to be aligned with the FATF requirements, these amendments are imposing rules on the transfer and exchange of DPTs, on custodial wallets and on how DPT transaction are being brokered.
Fears that the new regulations may impede the innovation in the crypto sphere in he country have been expressed.
Europe’s AMLD5 Caused Many Crypto Businesses to Shut Down. Could the Same Happen in Singapore?
British crypto payments provider Bottle Pay and Bitcoin (BTC) gaming platform Chopcoin have announced they’re closing down when AMLD5 has been introduced in Europe, whereas the Netherlands-based exchange Deribit is planning to move to Panama because of the new regulations. It’s true some voices agree with AMLD5, but these are only a few, like for example, the one of Elliptic’s head of community, David Carlisle, who said the new requirements are “bread-and-butter”.
No opinions have yet been heard about the PSA. It remains to be seen how crypto exchanges and businesses are going to act further and which side they’re going to choose.