Singapore Confirms It Will Not ‘Ban’ Cryptocurrency, But Risk Remain

Singapore's deputy prime minister Tharman Shanmugaratnam provided new commentary on the government’s commitment “not to ban” cryptocurrency as part of its future regulatory plans.

In a series of fourteen statements published Monday, Feb. 5 in response to questions posed by members of parliament Tuesday, Tharman Shanmugaratnam, deputy prime minister and minister in charge of regulatory body the Monetary Authority of Singapore (MAS), confirmed a broadly hands-off policy regarding cryptocurrencies going forward.

“...(MAS) 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,” the deputy PM said.

“But we will be subjecting those involved as intermediaries to our anti-money laundering regulations. And we will keep highlighting to Singaporeans that they could lose their shirts when they invest money in cryptocurrencies.”

Like Japan, Singapore has highlighted itself as a permissive environment for both cryptocurrency and Blockchain innovation over the past few years.

In stark contrast to China and Indonesia, the city-state has favored Blockchain in particular as part of its bid to become a global hub for the technology.

Addressing the disparity between Singapore and its neighbors, Shanmugaratnam noted that volumes involved were comparatively small and exposure to the financial system correspondingly insignificant.

“For now, the nature and scale of cryptocurrency trading in Singapore does not pose risks to the safety and integrity of our financial system,” he continued.

“...Further, connections between cryptocurrency trading and Singapore’s financial system are also not significant at present. Singapore’s banking system does not have any signficant (sic) exposure to global and local entities dealing in cryptocurrencies. We hence do not have broader, systemic risk concerns with regard to cryptocurrencies.”

Last month, MAS managing director Ravi Menon sounded similarly bullish on crypto’s future when he went on record to mainstream media to say he hoped assets and their underlying technology would survive a major crash.