Singapore Bans Overseas Crypto Ops by June 30

The MAS (Monetary Authority of Singapore) has ordered local crypto firms to halt overseas operations by June 30.  If they don’t have a Digital Token Service Provider license, they need to stop serving overseas clients. Non-compliance may lead to fines up to $200,000 or jail time. 

This move by the MAS should protect consumers. It also restrains money laundering risks. So, what does his mean for crypto firms in Singapore?

The MAS Ban on Overseas Crypto Ops in Singapore

The deadline for this ban by the MAS is 30th June. The ban targets local companies and individuals in Singapore. It singles out those dealing in digital assets without license. More specifically, those catering to international transfers or payment services. 

This move comes as an answer in response to industry feedback. It’s a regulatory framework proposed by the Digital Token Service Providers (DSTPs). This files under the Financial Services and Markets Act of 2022 or the FSM Act. 

The regulation aims to align Singaporean laws with global standards. However, Singapore is also known as a pro crypto hub. There’s criticism that this could come in the way of innovation. This can lead to firms leaving Singapore for countries with less strict policies. This can put a stain on Singapore’s current position as a crypto hub.

The current situation is that firms providing digital token services need to get a license. The alternative is to stop offering their services after 30th June. Fines can be as high as $250,000 Singaporean dollars ($200,000) or, alternatively, jail time. The latter could be as long as three years.

Hagen Rooke is a Singaporean lawyer. He’s a partner at Gibson, Dunn & Crutcher, and he made a comment on LinkedIn about this ban. So, his comment stated that only in extremely limited circumstances the MAS will grant a license. That’s because this type of operating models generally gives rise to regulatory concerns. For example, related to AML or CFT. That’s Anti Money Laundering or Countering the Financing of Terrorism. 

The MAS tries to close potential loopholes with this ban. Especially targeting firms that are registered in Singapore but are active outside of Singapore. The ban stops them from conducting unregulated activities outside of Singapore.

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