While Singapore wants to be a progressive regulator, it is not friendly to cryptocurrency trading, claimed Brian Armstrong, co-founder and CEO of the American cryptocurrency exchange platform Coinbase. After many retail investors lost sizable portions of their savings, the city-state has repeatedly cautioned that cryptocurrencies are highly speculative and volatile. Additionally, it forbids cryptocurrency advertising on social media and in public places.
“Singapore wants to be a Web3 hub, and then simultaneously say: ’Oh, we’re not really going to allow retail trading or self-hosted wallets to be available,” said Armstrong at the Singapore FinTech Festival 2022.
He was speaking alongside the Monetary Authority of Singapore’s chief fintech officer, Sopnendu Mohanty.
“Those two things are incompatible in my mind, and I would like to see Singapore embrace retail trading and self-hosted wallets,” Armstrong added.
It follows MAS’s preliminary approval of Coinbase’s plan to provide digital payment token services in the city-state.
Singapore has only issued 17 in-principle approvals and licenses thus far, following a rigorous selection procedure that involved 180 applications. After spending months in regulatory limbo, Binance reportedly withdrew its application to operate in the city-state earlier this year.
Retail investors today, according to Mohanty of the Monetary Authority of Singapore, are “exposed to risks they do not understand they are taking.”
“We believe that Web 3.0 is the future and what we want to do is to ensure that the money which can transact on this ecosystem is considered a safe asset, safe currency. As long as that is the direction, we are OK,” added Mohanty.
Armstrong was then asked by Mohanty to name any regulations that he believed needed to be reviewed.
“For centralized exchanges and custodians [like Coinbase], I think they should be treated just like other financial service businesses. There should be anti-money-laundering protections. There should be audits that they need to complete, no commingling of funds, appropriate disclosures to customers,” said Armstrong.
“Crypto should not be treated at a disadvantage; they should be treated equally with other financial service regulations.”
Mohanty responded by using the example of a customer using a banking app.
“We, as the regulator, don’t worry about internet protocols. We only care about the customers who went to the bank. The bank is responsible to ensure that they protect their customers,” he added.
(Adapted from CNBC.com)