At a conference, the managing Director of the central bank in Singapore, the Monetary Authority of Singapore, Ravi Menon, said the country has no intentions whatsoever to impose regulatory restrictions on cryptocurrencies at the moment.
This is a sentiment that Menon shares with the President of the European Central Bank, Mario Draghi, who had said that the European Central Bank does not think that it is not planning to impose regulations or even in the process of marking up a regulatory framework for cryptocurrencies right now. He mentioned that the ECB is of the opinion that the Bitcoin market needs a sufficient amount of time to mature and any regulatory actions on the behalf of the financial institution will be considered when it has matured.
Menon was noted as saying in the conference, “We’ve taken the approach that the currency itself does not pose the risk that warrants regulation. It is a known fact that cryptocurrencies are quite often abused for illicit financing purposes, so we do want to have AML/CFT controls in place. So those requirements apply to the activity around cryptocurrency, rather than the cryptocurrency itself.”
That being said, Menon was specific in his words when talking about no possibility of regulations ‘in the short term’. He said that the MAS will continue to have an open minded approach towards Bitcoin and other cryptocurrencies. Menon more importantly noted that if there is a need in the future for regulations, the MAS and the Singaporean government will provide the necessary regulatory framework for businesses and investors.
He explained that their approach is to look at the activity surrounding Bitcoin and work up regulatory procedures based on their assessment for whatever necessarily requires regulation. If Singapore chooses to regulate Bitcoin at some point, it has every potential to become a major Bitcoin market along the lines of Korea, Japan and Hong Kong. As a consequence, Asia will become the more dominant powerhouse for cryptocurrencies when you consider the fact that Japan is accountable for 68 percent of Bitcoin trades in the Asian region at the very least and the South Korean Ether has established itself as the biggest Ether exchange in the world.
Regulations imposed by the MAS in the long run will mean that the Japanese government’s plan to establish a national cryptocurrency exchange program will see a realization. The cryptocurrency exchanges will as a result be able to obtain licenses so that they can function as regulated financial service providers and will be given fair treatment as legitimized financial companies within the country.
By banning ICOs and cryptocurrency trading imposed by China has caused a huge chunk of investors into ICOs and exchanges to migrate their businesses towards the likes of Japan and Hong Kong which happen to be very cryptocurrency friendly. This means that if Singapore decides to install regulatory frameworks for cryptocurrencies, investors and traders from the likes of China and Russia will find their way into the cryptocurrency market in Singapore. The country has every bit of potential to become a major market for cryptocurrencies. Let’s see how things go.