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Singapore has become a favorite spot for ventures dealing with digital money. This is seen in the country’s crypto market revenue, which could reach US$342.3 million in 2024. This growth is thanks to the country’s strong set of rules. But what do they involve?
You need a permit to operate a crypto business in the country. This permit requires you to follow strict rules against concealing funds and financing terrorism. Ventures that meet these high standards are getting trusted more. They are boosting confidence among both consumers and investors.
Interested in more details? Keep reading.
A Singaporean permit comes with the following benefits:
Singapore is situated in the heart of Asia. It provides access to a dynamic market and positions authorized ventures for global expansion.
Singapore provides clear and transparent statutes for cryptocurrency ventures. These laws offer legal certainty and stability.
Being authorized in Singapore enhances the credibility and reputation of ventures. It instills trust among investors and customers.
Authorized ventures in Singapore have access to banking services and financial infrastructure. These financial services facilitate operations and expansion.
Singapore’s statutes are recognized internationally. This enables authorized ventures to operate easily and expand into global markets.
Singapore is a leading blockchain innovation hub. It offers access to talent, resources, and opportunities for collaboration and growth.
Obtaining a cryptocurrency permit in Singapore signals a commitment to compliance. This boosts investor confidence and attracts capital.
The Monetary Authority of Singapore (or MAS) oversees crypto activities. It enforces rules that encourage innovation while ensuring customer safety. Exchanges and wallet providers must obtain permits to:
The Payment Services Act (PSA) provides a framework for the regulation of payment systems and payment service providers in Singapore. Under this act, digital payment token (DPT) services, which include cryptocurrency exchanges and other cryptocurrency-related services, are regulated. Entities dealing with DPTs must obtain a license from MAS and comply with specific regulatory requirements.
Except for PSA, cryptocurrencies can be regulated by the following laws in Singapore:
In Singapore, crypto ventures mainly follow the Payment Services Act (or PSA). Under this act, regulated payment services include account issuance services, domestic money transfer services, cross-border money transfer services, merchant acquisition services, e-money issuance services, money-changing services, and digital payment token services.
The latter services – digital payment token services – in general cover main transactions with cryptocurrencies such as buying or selling DPTs, providing a platform to allow persons to exchange DPTs, transmitting or arranging for the transmission of DPTs, providing custodian wallet services for DPTs, actively facilitating the buying or selling of DPTs without possession of monies or DPTs.
In order to provide DPT services, the company shall have one of the following licenses:
Ventures that provide Singapore licensed crypto exchange services at a large scale need this permit. Namely, this license would be needed if the payment transactions exceed the following thresholds:
If a crypto company does not meet the thresholds for the Major Payment Institution License as outlined above, the company might be eligible for a Standard Payment Institution License.
Fulfill the requirements below to obtain your Singapore crypto exchange license:
Taxes related to crypto activity in Singapore are easy to understand. They are classified into the following categories.
Companies that carry on a business in Singapore are taxed on their Singapore-sourced income when it arises and on foreign-sourced income when it is remitted or deemed remitted to Singapore. The general corporate tax rate is 17%. These rules generally apply to companies engaged in crypto activities. For example, businesses that buy and sell digital tokens in the ordinary course of their business are taxed on the profit derived from trading in the digital token. Profits derived by businesses that mine and trade digital tokens in exchange for money are also subject to tax.
At that, there are no capital gains in the country. So where businesses that buy digital tokens for long-term investment purposes enjoy capital gains from the disposal of these digital tokens, these such gains are not subject to tax.
In Singapore, the following supplies of digital payment tokens are exempt from Goods and Services Tax (GST): exchange of digital payment tokens for fiat currency or other digital payment tokens and provision of loans of digital payment tokens. At that, the use/ provision of digital payment tokens as payment for anything (other than fiat currency or other digital payment tokens) is disregarded as a supply for GST purposes.
To start the process with MAS cryptocurrency license Singapore, you will need to Incorporate a legal entity in Singapore. It can be a private limited company which is the most popular type of company here. There is also a need to arrange for local directors and providers of accounting and audit services.
Find the proper type of license based on what is the scale of your business - it could either Major Payment Institution License or Standard Payment
Complete the application form. Gather supporting documents. Include information on key persons within the company.
Submit the application and documents to the MAS. Pay the application fee.
MAS reviews the application. Provide any extra information requested and attend interviews.
If approved, MAS issues the permit. You can then start business operations.
Put in place strong compliance and risk management frameworks. Engage trusted experts, like InteliumLaw, to navigate the regulatory process.
InteliumLaw provides expert guidance on Singapore's cryptocurrencies laws. We handle the application and set up strong compliance measures. These include AML and CTF policies. Our expertise and risk management support helps secure your business's stability. InteliumLaw provides continuous support for compliance and regulatory updates. This support positions your business for success in Singapore's dynamic crypto market.
Singapore regulates cryptocurrency. MAS sets the rules under the PSA. This applies to crypto ventures, like exchanges and wallet services. They need a permit and must follow rules to stop concealing funds and protect consumers.
To get the crypto license in Singapore, you will need to create a local company there and complete the application process within the local authority, MAS.
Direct costs associated with a crypto license in Singapore include license application fees (starting from S$1,000) and requirements for the share capital of the applying company. For example, the company that wishes to obtain a Standard Payment Institution License shall have minimum capital of S$100,000. However, except for these costs, you shall also consider the costs of the company’s creation and maintenance.
The whole process can take up to 6-10 months.
The company applying for a crypto license in Singapore must have a permanent place of business or a registered office where the books and records can be securely held. At that, at least one person must be appointed to be present at the place of business or a registered office to address any queries or complaints from consumers
The accumulated experience and tracking of future changes in this area allow us to be proactive
for our clients and develop the most adapted business structures to modern conditions.
By submitting this form, you hereby authorize Inteliumlaw to process your information for the purpose of addressing your inquiry. You retain the right to revoke this consent at any point. For further details, please review our Privacy Policy.
The accumulated experience and tracking of future changes in this area allow us to be proactive
for our clients and develop the most adapted business structures to modern conditions.
By submitting this form, you hereby authorize Inteliumlaw to process your information for the purpose of addressing your inquiry. You retain the right to revoke this consent at any point. For further details, please review our Privacy Policy.
