Following a keen study on cryptocurrencies and their trading by the country’s central bank, Singapore’s deputy prime minister has stressed there is no reason to ban cryptocurrency trading among residents.
Tharman Shanmugaratnam, Singapore’s deputy prime minister and minister in charge of the central bank, was speaking at a parliamentary session yesterday when he fielded questions by three Members of Parliament (MEPs) about any potential ban of cryptocurrency trading in Singapore.
The questions pointedly mentioned China’s ban on domestic exchanges and South Korea’s similar – but now debunked – hostile stance with local trading markets. Is “any action…being considered to ban the trading of bitcoin currency or cryptocurrency…?” was one of the questions posed.
“Cryptocurrencies are an experiment,” Singapore’s deputy PM explained, stating their numbers had grown internationally and are currently at a nascent stage. Claiming it was “too early” to state if cryptocurrencies will succeed, the minister who oversees Singapore’s central bank, suggested that the “full implications” of cryptocurrencies will take time to understand if they do succeed in society.
More pointedly, however, is a standout statement from the deputy PM who stated in response to the questions of a ban akin to China’s own crackdown:
“The Monetary Authority of Singapore (MAS) [Singapore’s central bank] has been closely studying these developments and the potential risks they pose. As of now, there is no strong case to ban cryptocurrency trading here. But we will be subjecting those involved as intermediaries to our anti-money laundering regulations.”
The remarks ring similar to those offered by the MAS managing director Ravi Menon last year. Bitcoin itself doesn’t pose any risks requiring regulation, the central bank chief said at the time, instead pointing to regulation of intermediaries like exchange operators who would have to comply with existing anti-money laundering and counter-terrorism financing laws.
“There are two main uses of cryptocurrencies today. The first is as a means of payment,” the deputy PM continued in his remarks yesterday. “The second, which has become far more prominent, is where cryptocurrencies are assets in their own right. People are trading in them in the hope of making a profit.”
Furthermore, the official went on to reveal ongoing efforts toward regulating cryptocurrency exchanges that will see cryptocurrencies like bitcoin under a singular legislation of retail payment services alongside public cautions of risks in cryptocurrency investments. “The big fall in bitcoin prices in recent weeks illustrates the risk,” the deputy PM added yesterday.
Still, the senior Singaporean official stressed that the country’s authorities will adopt an embracive and cautious approach to cryptocurrencies going forward.
“We will continue to encourage experiments in the blockchain space that may involve the use of cryptocurrencies, because some of these innnovations could turn out to be economically or socially useful. But equally, we will stay alert to new risks.”