By Yusoff Kim
Compiled by: Cointime Lu Tian
Although Singapore was once seen as the next cryptocurrency hub, especially in the Asia-Pacific region, the small country has adopted a more conservative approach in the past few years. However, this does not mean that Singapore has closed its doors to Web3.
In fact, while Singapore has strict regulations on cryptocurrency-related activities, it is still working to actively and prudently promote the use of blockchain technology, especially in the field of retail users.
In Singapore, one of the hurdles most cryptocurrency companies need to overcome is obtaining a major payment institution license from the Monetary Authority of Singapore (MAS).
As a comprehensive regulation of the emerging trend of FinTech, Singapore introduced the Payment Services (PS) Act in 2019, providing a forward-looking and flexible framework for industry players.
To obtain a license, virtual asset service providers must have controls in place to ensure appropriate due diligence, proper solicitation and adequate risk disclosure.
Since the law came into effect in 2020, 461 companies have received licenses or have had such licenses approved in principle, of which 19 provide cryptocurrency-related services as of the time of writing (June 7, 2023).
Cryptocurrency companies holding major payment institution licenses in Singapore
1. FOMO Payments
The first company to receive a license from the Monetary Authority of Singapore (MAS) is Fomo Pay, a local fintech company focused on mobile payment solutions. They provide businesses with a range of services and products that enable them to accept a variety of mobile payment methods and meet the changing consumer preferences in the digital payment space. Their goal is to simplify the payment process for Web2 and Web3 businesses through the platform and support more than 10,000 merchants and financial institutions in Asia and Africa.
The platform obtained a major payment institution license on September 1, 2021, covering domestic remittances, cross-border remittances, merchant acquiring and digital payment token services.
2. DBS Vickers Securities
DBS Vickers Securities is a popular securities and brokerage firm in Singapore and a subsidiary of DBS Bank, one of the largest financial institutions in Southeast Asia. They provide a range of investment and trading services to individual and institutional clients in multiple markets including Singapore, Hong Kong, China, Indonesia, Thailand and the United States.
The platform obtained the Digital Payment Token Service License from major payment institutions on October 1, 2021.
3. DTC Pay
Digital Treasures Center is a digital payment company that uses blockchain technology to build traditional infrastructure. They provide digital payment solutions for global enterprises, providing multi-currency swaps, online payments, in-store payments, and crypto payments on a single platform so that individuals and businesses can transfer value in a seamless and efficient manner.
The platform obtained a major payment institution license on August 2, 2022, covering account issuance, domestic remittances, cross-border remittances, merchant acquiring, e-money issuance, and digital payment token services.
4. Independent Reserve
Independent Reserve is Singapore's first licensed cryptocurrency exchange and a cryptocurrency exchange in partnership with DBS Vickers. They call themselves a regulatory-friendly exchange that focuses on trust and security, primarily serving regions such as Australia, New Zealand, and Singapore. Citizens from more than 30 countries can join.
The platform obtained a major payment institution license on October 1, 2022, covering account issuance, domestic remittances, cross-border remittances and digital payment token services.
5. CoinHako
Coinhako is a Singapore-based cryptocurrency exchange and digital wallet provider that allows users to buy, sell and store a variety of cryptocurrencies. The platform aims to provide individuals with a user-friendly and secure platform to trade and manage cryptocurrencies.
Coinhako received its major payment institution license on May 6, 2022, covering digital payment token services.
6. Revolution
Revolut is a financial technology company headquartered in London, UK, that provides a range of digital banking services and products, the most well-known of which is a prepaid Visa card that can be used for overseas payments. The company was founded in 2015 and focuses on providing innovative and user-friendly solutions to manage money and payments.
The platform obtained a major payment institution license on August 2, 2022, covering account issuance, domestic remittances, cross-border remittances, merchant acquiring, e-money issuance, and digital payment token services.
7. Sparrow
Sparrow describes itself as a custom digital asset solutions company committed to adhering to the highest regulatory and cybersecurity standards. The platform was acquired by Temasek-backed Amber Group in late 2022.
The platform obtained a major payment institution license for digital payment token services on August 1, 2022.
8. Paxos Global
Paxos is a fintech company that specializes in providing blockchain-based solutions for the financial industry. Currently, they provide cryptocurrency brokerage, asset tokenization, and settlement services.
The company, best known for its USDP stablecoin, aims to connect traditional financial systems with blockchain technology to increase efficiency, transparency and trust in financial transactions.
The platform obtained a major payment institution license for cross-border remittances and digital payment token services on November 2, 2022.
9. MetaComp
MetaComp is a Singapore-based cryptocurrency exchange that offers a full suite of digital asset products, including OTC and exchange trading, fiat payment gateways, digital asset custody, prime brokerage, and asset management.
MetaComp was founded in 2018 from parent company MetaVerse Green Exchange, built on the cloud and powered by the Nasdaq trading engine.
The platform obtained a major payment institution license for cross-border remittances and digital payment token services on December 1, 2022.
10. Crypto.com
Crypto.com is a leading cryptocurrency exchange with over 80 million users worldwide, supporting over 250 cryptocurrencies and 20 fiat currencies.
The exchange also offers other services, including the crypto.com Visa card for instant crypto payments, and purchased the naming rights to the Crypto.com Arena (formerly known as the Staples Center).
The platform obtained a major payment institution license on August 2, 2022, and can provide account issuance, domestic remittances, cross-border remittances, e-money issuance and digital payment token services.
11. Circle
Circle, a global payments company best known for its stablecoin USDC, received a full license from MAS for their Singapore entity shortly after opening an office in May this year.
The company also provides enterprise solutions such as digital asset management and on- and off-ramp services.
The platform obtained a major payment institution license on August 2, 2022, and can provide account issuance, domestic remittances, cross-border remittances and digital payment token services.
A company that has obtained a Singapore standard payment institution license
While many major cryptocurrency companies have applied for a Major Payment Institution License (MPI), there is also a Standard Payment Institution License (SPI), which allows companies to carry out similar services as the previous licenses.
However, the SPI license has the highest thresholds for its services, as stated in the PS Act, including:
Any payment service with a monthly transaction value of S$3 million or above (excluding e-money, account issuance and currency exchange services)
Two or more payment services with a monthly transaction value of S$6 million (excluding e-money, account issuance and currency exchange services)
Daily outstanding e-money reaches S$5 million
Despite this, there are currently only two companies in Singapore that provide cryptocurrency-related services and hold standard payment institution licenses.
1. BHOP Consulting (BHEX)
BHEX is a financial digital asset trading platform under BHOP Consulting, providing cryptocurrency exchange, custody and electronic payment services.
The platform obtained a standard payment institution license on August 19, 2022, allowing it to provide digital payment token services.
2. Triple A
Triple A is a secure and easy-to-use crypto payment gateway that enables businesses to accept crypto payments.
Founded in 2017, the company allows businesses across industries to utilize blockchain technology for payments without the risk of processing or converting the volatility of digital currencies.
The platform obtained a standard payment institution license on November 30, 2021, allowing it to provide domestic remittances, cross-border remittances, merchant acquiring and digital payment token services.
Companies that have received in-principle approval in Singapore
Before full approval, a company may receive approval in principle for a license, which is a temporary stage during the application period.
At the approval-in-principle stage, applicants are generally required to meet specific conditions set by MAS, including meeting capital requirements, demonstrating strong anti-money laundering and countering the financing of terrorism (AML/CFT) controls, and having an appropriate corporate governance structure and an effective risk management framework.
Applicants are also required to provide detailed business plans and operational processes to ensure compliance with regulatory guidelines.
During this period, the company will typically receive conditional approval to continue activities associated with the license.
Ripple
Ripple is a blockchain-based digital payment network and protocol best known for its native cryptocurrency XRP.
Founded in 2012, the company has seen phenomenal growth for its on-demand liquidity service over the last year, with a particular surge in volumes in the Asia-Pacific region.
The platform received approval in principle for a major payment institution license on June 22, 2023.
The flag of Singapore
Sygnum Singapore is a digital asset bank and specialist headquartered in Singapore and Switzerland.
The platform provides services such as brokerage, custody, lending, tokenization and asset management.
Currently, its portfolio includes regulated banking services covering a variety of cryptocurrencies such as Bitcoin, Ethereum and XRP.
The platform received approval in principle for a major payment institution license on March 8, 2022.
Blockchain.com
Blockchain.com is a London-based cryptocurrency company that provides a full suite of cryptocurrency services, including cryptocurrency wallets, trading services, blockchain explorers and analytics platforms, as well as various institutional services.
The platform received approval in principle for a major payment institution license on October 12, 2022.
Coinbase
Coinbase is one of the world's largest and most well-known cryptocurrency exchanges and digital asset platforms. It was founded in 2012 and is headquartered in San Francisco, California, USA.
Coinbase offers a range of services for buying, selling, storing and using a variety of cryptocurrencies.
The platform received in-principle approval for a major payment institution license on October 11, 2022.
Companies that have withdrawn their Singapore license applications
moon
Luno is a cryptocurrency exchange and digital asset platform that allows users to buy, sell, store and trade cryptocurrencies. The platform mainly focuses on serving emerging markets such as Africa and Southeast Asia.
Although the company had applied for a license in Singapore, it notified the Monetary Authority of Singapore in 2023 that it had decided to stop providing services to Singaporean customers and withdrew its license application.
Hodlnaut
Hodlnaut is a Singapore-based cryptocurrency platform that provides various services related to lending and earning interest on cryptocurrencies.
Following the fallout from $UST and TerraForm Labs, Hodlnaut notified its users that it would be placed under judicial management, despite claiming that it was not at significant risk. The platform is no longer operational, has suspended all services, and informed the Monetary Authority of Singapore that it planned to withdraw its license application late last year.
Genesis (unconfirmed)
Genesis is a company under Digital Currency Group that focuses on providing digital asset financial services to institutional investors and is also the parent company of Luno.
Although Genesis APAC received an in-principle approval in June 2022, it has filed for bankruptcy following the collapse of cryptocurrency firms 3AC and FTX. Although the in-principle approval has not been formally withdrawn, it is less likely that Genesis APAC will continue to operate in the region.