As various countries now attempt to establish a clear framework for the emerging blockchain industry, Singapore became the latest to officially embrace the technology.
In replies to parliamentary questions intended to clarify the Monetary Authority of Singapore’s (MAS) position on cryptocurrency and digital assets, Deputy Prime Minister Mr Tharman Shanmugaratnam provided a range of generally positive statements on the subject whilst retaining a cautionary tone.
“No reason to ban crypto-currency trading”
Formally recognising a clear distinction between coins being used as currency and those being used as utility tokens, Mr Shanmugaratnam stated that both types were in relative early stages of development yet both “may prove to have potentially useful applications in facilitating payments and trade settlements.”
As such, he noted that there is no reason for Singapore to ban cryptocurrency trading.
Specifically in relation to ICOs, the Deputy Prime Minister made it clear that each new sale should be analysed by the Suspicious Transaction Reporting Office (STRO) to check for possible tax evasion and money laundering. The approach appears to echo the case-by-case approach advocated by the UAE for ICOs in a statement issued by Emirati authorities last Sunday.
Along side this, Shanmugaratnam placed some emphasis on the need for educating the general public in relation to the risks involved with initial coin offerings as well as the speculative nature of such investments.
Tellingly, Singapore’s Deputy PM further asserted that cryptocurrencies posed no broad or systemic risks to the current Singapore structure.
Mr Shanmugaratnam summed up the MAS viewpoint by concluding, “We will continue to encourage experiments in the blockchain space that may involve the use of cryptocurrencies, because some of these innovations could turn out to be economically or socially useful. But equally, we will stay alert to new risks.”
Singapore has become something of a hub for blockchain start-ups in the last eighteen months within the South East Asia region. The Singaporean government’s declaration adds to positive views on both crypto-currency and ICOs espoused by the SEC during a senate hearing on Monday, which should help to counter some of the recent market panic observed in light of China’s doubling-down of its ban on ICOs.