Singapore’s main central bank could be making steps the authorization of the usage of crypto in the city-state.
The Monetary Agency of Singapore (the central bank of Singapore) recently issued a consultant paper, aiming to allow the use of what it calls “payment token derivatives” for listing and trading on “approved exchanges” in the country.
This paper came in response to a heightened demand from international investors. These investors demanded that products should be able to use crypto currency coins as payment.
As of now, Singapore has four agencies which can exchange currency for other assets. These are the Asia Pacific Exchange, ICE Future Singapore, Singapore Exchange Securities Trading Limited and Singapore Exchange Derivatives Trading. These are names given by the Monetary Agency.
Singapore’s Security and Futures Act currently does not recognize or categorize alternative payment options like Bitcoinand Ether payment coins as assets. However, the Monetary Agency has stated that they had received many requests to reverse this. The requests wanted to put these assets under the regulatory organization to allow the cryptos to be listed as approved by the Act.
The bank made sure to indicate that crypto derivatives wouldn’t be accessible to all Singaporeans, as per regulations by other financial bodies.
It has to be noted that this news comes not long after Bakkt, a service launched by New York Stock Exchange giant ICE, reported that it would begin to expand its physically settled Bitcoin futures product in Asia. This would allow it to be available for trade on the ICE Futures Singapore platform.
Despite this seemingly positive move on the part of the Monetary Agency, they also mentioned how they thought that payment token derivatives were not suitable for retail investors. This opinion is based on the concept that payment tokens have no intrinsic value and are highly subject to price volatility and fluctuation.
This regulatory move on the part of Singapore is a positive step for cryptocurrencies in general. Government acceptance of crypto usage as payment of transactions will further help the crypto to become more accessible to the general public.