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Singapore officials have warned people chasing digital investment opportunities to exercise caution and participate ‘responsibly’. Photo: Dreamstime/TNS

Singapore officials urges caution on cryptocurrencies after scams raise questions in parliament

  • Singapore has expressed a desire to become a hub for cryptocurrency and financial technology, but officials are proceeding with caution
  • MPs have warned of Singaporeans losing tens of thousands of dollars to scams such as one ‘gaming craze’ called Neko Inu
Singapore officials warned people chasing digital investment opportunities such as non-fungible tokens and metaverse assets to exercise caution and participate “responsibly” – a recommendation that mirrors the city state’s own balancing act as it promises to embrace cryptocurrency, but in a measured way.

Singapore’s government is “closely studying” the characteristics and risks of technologies such as blockchain, decentralised finance, NFTs and the metaverse, Minister for Communications and Information S Iswaran wrote in a reply to a question from parliament member Yip Hon Weng.

“Similar to the physical world, the government will seek to balance between promoting economic vitality, preserving social stability and protecting public security in the digital domain,” Iswaran said. He called on individuals and companies to “play their part by participating responsibly in the metaverse.”

Bitcoin is one of the best-known and widely traded cryptocurrencies. Photo: AFP

Singapore officials have expressed a desire for the nation to become a hub for cryptocurrency and financial technology, and numerous companies in the sector have set up regional or global headquarters there.

However, it is also approaching the emerging technology with caution: few applications for licences to operate a regulated cryptocurrency business have been approved, and the vetting process has taken longer than expected. Among companies that failed to secure a coveted permit was an affiliate of Binance Holdings Ltd., the world’s largest cryptocurrency exchange.

In Asia’s virtual future, will one metaverse emerge to rule them all?

Singapore’s efforts to tame cryptocurrency risks come against the backdrop of regulators worldwide moving to exercise greater control over the sector. In Hong Kong, authorities are shifting from an “opt-in” approach to cryptocurrency exchanges to a fully regulated regime.

MP Shahira Abdullah said Singaporeans had lost more than S$100,000 (US$73,900) on one “gaming craze” called Neko Inu, without specifying whether that was an aggregate amount. She asked Home Affairs Minister K Shanmugam “what is being done to educate and protect youths from falling prey to cryptocurrency game scams”.

“When transacting with cryptocurrencies, we urge the public to only deal with entities that are regulated by” the Monetary Authority of Singapore, Shanmugam wrote in a reply on Tuesday. “Members of the public should also practice healthy scepticism to ask, check and confirm before making any transactions on cryptocurrency-related platforms, whether they be investment-related, or for online games.”