Ripple Labs, Coinbase, Binance, Gemini and other cryptocurrency firms, have received a permit to operate in the country without obtaining a license by The Monetary Authority of Singapore (MAS). The exemption is applicable for a limited period of time.
Singapore’s financial regulator, MAS, has granted license exemption to some cryptocurrency firms that allows them to offer specific digital payment services until July 28, 2020.
At the end of this period, the firms are to apply for the relevant license in order for them to carry out their offers and services.
Other firms granted exemptions
Apart from CoinBase, Ripple, and Binance, other recognized cryptocurrency firms have been granted exemptions. They include the Singapore entities of AAX Exchange, Cumberland, DRW, LedgerX, GSR, OKCoin, Pundi X, and few others.
The Chief Legal Officer of Pundi X Labs, David Ben Kay, said: “In compliance with the PS Act, we will be filing our license application to operate account issuance and digital payment token services by 28 July 2020.”
Some other crypto firms were offered a longer period of exemption. A 12-month exemption was granted to BitGo, a subsidiary of one of the biggest Bitcoin payment processors. As well as, to Gemini Trust Company led by the Winklevoss twins.
According to MAS, these firms can offer domestic money transfer, account issuance, and inward cross-border money transfer services in Singapore until January 28, 2021.
The regulators said: “Please note that these entities are not licensed under the PS [Payment Services] Act to provide the specific payment services, but are allowed to continue to provide the specific payment services,” said the regulator.
Some local crypto companies in Singapore have also praised PSA for serving as a legal instrument that encourages blockchain-related businesses.
Need for cryptocurrency regulation
At the beginning of 2020, the Payment Services Act, which represents the law regulating payments in Singapore, was established. The Act came into force when the MAS aired its interest concerning cryptocurrencies because of their anonymity, which can lead to laundering of money. Due to this fact, all cryptocurrency firms must possess the relevant license in order to operate in the country.
Besides, under the Act, there are three classes of licenses that should be granted and this includes:
- money-changing license,
- standard payment institution, and
- major payment institution.
“Each service provider needs to hold only one of the three licenses,” said MAS.