The city-state of Singapore is slowly becoming a favored destination for Blockchain startup companies looking to launch an Initial Coin Offering (ICO). The country has long been a center for startups due to such factors as tax-friendly regulations, light-touch rules, and state funding. The state has already hosted a number of successful ICOs in the past.
Singapore’s efforts to support and regulate Blockchain and cryptocurrencies
The Singapore government, through its central bank, the Monetary Authority of Singapore (MAS), has launched several programs to support the financial technology (fintech) industry. One of the initiatives is the allocation of S$225 million ($166 million) for the development of fintech projects and applications.
Moreover, the central bank has also introduced a tokenized version of the Singapore dollar under the so-called “Project Ubin” to show its warm welcome to crypto-assets. The token is available on an Ethereum-based Blockchain. The project aims to create a functional alternative to the country’s interbank payments network via tokenization and Blockchain technology.
Meanwhile, the MAS has also moved to regulate digital currencies with an aim to protect ICO activities. The MAS also wants to maintain the reputation of Singapore as a financial hub and to prevent money laundering. With proper regulation, investors are protected and more people can participate in ICOs.
On the issue of whether virtual currencies are considered a currency, token or security, the MAS has said that the function of cryptocurrencies has evolved beyond just being a digital currency.
Part of the MAS statement read:
“The function of digital tokens has evolved beyond just being a virtual currency. For example, digital tokens may represent ownership or a security interest over an issuer’s assets or property.”