Strange contrasts in the city-state. Last December, the Monetary Authority of Singapore (MAS) first crypto activist persona non grata. Last July, it was against crypto trading intended for the general public that the regulator hardened its tone. His stance on retail trading stands in stark contrast to his dovish attitude towards blockchain projects, hedge funds and big banks. DBS Bank, for example, has just expanded its Bitcoin and altcoin trading services to its wealthy clients.
DBS Bank extends crypto trading to wealthy customers
According to the amount of its assets under management (291 billion dollars at the end of 2021), DBS is the largest bank in Southeast Asia.
And the DBS loves cryptos. Or rather, thehuge financial windfall due to the massive installation of institutional blockchain players in Singapore.
To date the DDEx has had approximately 1,000 accredited clients, and has generated an annual volume of 1 billion dollars. June saw a jump in BTC (+300%) and ETH (+65%) purchases on the scene, as reported by our colleagues from Cointelegraph.
The DBS has decided to extend access to its wealthy, hand-picked clients: the client will be required to hold a cryptofile minimum $246,000 available.
The expansion of the target should make it possible to increase the DDEx from 1,000 to 300,000 customers by the end of 2023.
BTC, ETH, XRP and BCH are listed on the DDEx exchange – ddex.dbs.com
Singapore, the stronghold of institutional crypto trading…
The hedge fund disaster Three Arrows Capital (3AC) had at least that merit. That highlights the importance of cryptocurrencies in institutional trading in Singapore.
Most hedge funds, family offices, and local investment funds hold BTC and altcoins in their portfolio. From January 2020, the corporation tax system (controlled by theInland Revenue Authority) capital gains on crypto-assets are exempt from taxes and other levies.
Several major players in cryptocurrency mining have settled there, fueling themselves with hydroelectricity and solar power. Saitech, the largest of them, even joined the Nasdaq.
But these are mostly the blockchain “infrastructure” companies that the government intends to attract. In its report on local fintech in 2021, the firm KPMG highlighted that more than 30% of fintech investments were in Singapore i. basic encryption technologies.
If total investments in the sector have increased from 2.5 billion to more than 3.9 billion dollars at the end of 2021, the part linked to blockchain projects has increased by 13!
… but declared a desert for retail crypto trading
In three years, the tide has quickly turned for crypto exchanges in Singapore.
We remember that in 2019 the MAS unveiled a bill aimed at creating a specific approval for crypto exchanges and digital asset payment providers. view of “Silicon Valley of Crypto” earned more than 300 approval requests from tech giants: Alphabet (parent company of Google), Alibaba, Binance, FTX…
⚠️ Then at the end of 2021, the first tone change. The regulator has decided to get tough on retail cryptocurrency trading, citing the risks of over-indebtedness, money laundering and financing of illegal activities. Ads are now banned, much like the AMF banned binary options ads).
103 companies pay the price, their licensing exemptions are revoked. Among them are subsidiaries Revolut, BitGo and Bitxmi. Big fish like Bitstamp, Coinbase, Binance and Gemini escape the ax but some, like Binance, decide to pack anyway.
⚠️ Last June, the MAS drove the point home by obtaining the crypto-exchange license conditions. The semantics used are not misleading, and the regulator’s spokesperson, Sopnendu Mohanty, expressed a voluntary position “brutal and relentlessly relentless“to do the process”magical” for candidates.
Various studies show that the country has priority in relation toaccept cryptocurrencies. A report from UNCTAD shows that Singapore has the highest percentage of people holding crypto-assets among developed countries (9.4% end of 2021, see the picture below).
An average score that hides large variations, with a peak over 22% among people aged 25 to 45!
An investment trend that is definitely linked to the individual savings capacity : GDP per capita is one of the highest in the world. The 5.7 million living Singaporeans have an average annual income of $59,800, almost 55% higher than that of the French!
Source: UNCTAD Study
