Future Of Cryptocurrencies In Singapore

The virtual digital currencies are getting more prominent and dominant with the Bitcoin price surging to new highs.  Yesterday, on 31 October, 2017, CME the world’s largest Futures and Option trading platform announced the launch of Bitcoin Futures. This boosted Bitcoin price and it crossed $6400. The Bitcoin market cap also crossed $100 Billion and at the time of publishing this article, it was at $108 Billion, With few Asian countries including global economic power – China – having a major crackdown on the cryptocurrencies, there are other like Japan and South Korea who are weighing options and moving ahead positively with cryptocurrencies rather than taking a harsh stance.

Everyone is now eyeing on Singapore – which has been Asia’s major technology hub in the past decade and has significantly contributed to the economic growth of the continent. Singapore, who has always been open to new technologies and has been a early adopter of it, is being seen with optimism for its participation in the ongoing Fintech revolution.

However, the key decision-making players and authorities in the country has so far sent mixed signals regarding the future of cryptocurrencies in the country. The banks have so far remained shy to announce their stance with other regulatory agencies and authorities are quite reluctant to interfere in the cryptocurrency operations. Last month in September, banks had asked companies to close their cryptocurrency accounts where some speculated that such closures were the beginning for a crackdown on the cryptocurrencies and this act was related to the anti-money laundering legislation.

But it’s being said that cryptocurrency traders in Singapore are not much affected owing to the fact that most of their accounts are registered with overseas exchanges, majorly to the largest exchanges operating in the U.S. Moreover, retail traders don’t necessarily need to have account on exchange to trade Bitcoins or Ethereum. They can just do it by just opening a forex trading account at some brokers like IG. In this case, the trading positions will be held like CFDs (contracts for difference) meaning the traders will just participate in price moves without actually owing the coins.

Also Read: Central Bank Of Australia Voices Support Towards Bitcoin & Cryptocurrency Usage

Singapore has realised that it is not completely possible for a democratic nation to stop the cryptocurrency movement. Now embracing the movement means that majority of the trade will be moving out of the country and Singapore will be losing big-time on investments coming to them.

One of the major concerns authorities have been facing is deciding on which asset class do Bitcoin belong to. Digital assets can be represented in three different formats like equity – which includes having a stake in the protocol, a commodity and also a currency used to transfer money.

The only way out here is Bitcoins and other digital currencies to be put under a new asset class defined for them and thereby create a legal framework around it. One thing is clear that if Singapore wants to see itself as a Fintech hub just like Japan, it will have to positively adopt, by allowing cryptocurrency businesses and traders to participate in the new Blockchain Technology and also the cryptocurrencies as well.

Also Read: South Korean Central Bank Chief Says, “Bitcoin Is A Commodity And Not A Currency”

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