Singapore’s tighter cryptocurrency rules open sector to Hong Kong, other Asian rivals

Hong Kong, having fallen behind Singapore in cryptocurrency, is pivoting toward a friendlier regulatory regime as part of a goal of becoming a top cryptocurrency hub

This week, Singapore unveiled proposals to restrict retail participation in digital assets, including banning small investors from borrowing to fund coin purchases

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Published: 2:20pm, 28 Oct 2022Updated: 3:34pm, 28 Oct 2022

Asia may be heading for a reordering of sorts in cryptocurrency markets, with Hong Kong moving to legalise retail trading of digital tokens just as Singapore looks to impose fresh restrictions on consumers.

Speaking in an interview with Bloomberg Television, Singapore’s central bank chief Ravi Menon had a clear message for other financial centres looking to draw retail cryptocurrency trading away with more relaxed rules: We won’t stand in your way.

“We don’t set ourselves out to compete with other jurisdictions, especially on regulation,” said Menon, the managing director of the Monetary Authority of Singapore (MAS). “We have to do what is right for us, what is necessary to contain the risks. And the risks are primarily harm to retail investors.”

Hong Kong, having fallen behind Singapore in cryptocurrency in past years, is pivoting toward a friendlier regulatory regime as part of a recently stated goal of becoming a top cryptocurrency hub. Japan is taking steps to make it easier to list tokens, partially reversing a conservative stance that was blamed for driving cryptocurrency start-ups away. Australia is becoming a regional home for listings of exchange-traded products linked to digital assets.

Singapore’s evolving vision on the kind of regional digital-asset centre it prefers to be is as much an indication of the perils of letting mom-and-pop investors dabble in volatile virtual coins as an opening for other jurisdictions to gain ground.