The largest bank in Singapore, DBS Bank, is reportedly preparing to offer access to crypto trading to its wealthiest customers in a move that seeks to expand the reach of this service as interest in digital assets continues to surge.
According to an exclusive report from the Financial Times, DBS’s service could reach as many as 300,000 new customers once the new platform is up and running. At the moment, the service is only available for around 1,000 institutional investors including private banks and investment funds.
For DBS, one of its priorities is to protect the public from the volatility of the crypto market and the many scams that have surfaced amid the lack of appropriate regulatory oversight.
“On the one hand, we want to be a global crypto hub. On the other hand, we’re also very worried about our domestic population getting burned with this speculative asset class”, stated the Chief Executive Officer of DBS Bank, Piyush Gupta.
Singapore’s MAS to Introduce Crypto Regulation
Singapore has recently stated that it plans to introduce a comprehensive regulatory framework for cryptocurrencies that would primarily aim to protect individual investors from incidents such as the collapse of the Terra ecosystem and the insolvency of exchanges such as Hodlnaut and Zipmex.
According to the head of the Monetary Authority of Singapore (MAS), Ravi Menon, the agency plans to take all the measures required to “reduce consumer harm”.
This may include the introduction of rules that regulate the issuance of crypto assets and their use as a valid mean of payment as Menon believes that they should not be considered a form of money or a financial asset.
However, the Managing Director of MAS commented that the country still believes and bets on the “transformative” nature of blockchain technology and its power to revolutionize how multiple industries function.
Singapore has been progressively becoming a crypto hub with many prominent firms choosing the Asian country as a headquarter for their initiatives. Sadly, events such as the bankruptcy of the crypto-focused hedge fund Three Arrows Capital (3AC) and the incidents cited above have tainted the country’s reputation and may prompt regulators to impose stricter rules to protect the public.
Singapore Leads Asia in Crypto Adoption
A report from KPMG indicated that nearly $1.5 billion have been invested in crypto firms within Singapore – a figure that accounts for roughly half of the total poured into similar companies within the Asia Pacific region.
Meanwhile, a survey from Finder.com recently found that 1 million Singaporeans currently own crypto – a figure that accounts for roughly 20% of the nation’s total population. Of that total, around 33% lean toward Bitcoin (BTC) as their preferred financial asset followed by Ethereum (ETH).
The website ranked Singapore as the 6th country with the highest rate of crypto adoption among a total of 26 nations included in the survey.
For most countries, establishing appropriate regulations for cryptocurrencies and all related services is challenging due to the decentralized nature of blockchain technology.
In this regard, countrymen can rely on foreign exchanges and even bypass internet blocks by using virtual private networks (VPN) and other mechanisms to access platforms that allow them to trade crypto assets.
Peer-to-peer (P2P) exchanges are one of the easiest ways to use local currency to buy digital assets as investors can deal with locals directly and transfer money to their domestic bank accounts in exchange for the crypto assets they are looking to buy without the involvement of an intermediary.
The risks for consumers have become clearer lately as the crypto winter has resulted in the demise of several exchanges that have opted to freeze customers’ assets as poor risk management protocols and reckless dealings led to big losses and holes in their balance sheet.
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