{"id":14830,"date":"2022-11-26T07:05:10","date_gmt":"2022-11-26T07:05:10","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/singapore-regulator-explains-action-against-binance-vs-ftx-warns-even-licensed-crypto-exchanges-can-fail-regulation-bitcoin-news\/"},"modified":"2022-11-26T07:05:10","modified_gmt":"2022-11-26T07:05:10","slug":"singapore-regulator-explains-action-against-binance-vs-ftx-warns-even-licensed-crypto-exchanges-can-fail-regulation-bitcoin-news","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/singapore-regulator-explains-action-against-binance-vs-ftx-warns-even-licensed-crypto-exchanges-can-fail-regulation-bitcoin-news\/","title":{"rendered":"Singapore Regulator Explains Action Against Binance vs FTX \u2014 Warns Even Licensed Crypto Exchanges Can Fail \u2013 Regulation Bitcoin News"},"content":{"rendered":"

(Originally posted on : Bitcoin News )<\/b>
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The Monetary Authority of Singapore (MAS), the regulator overseeing the crypto sector, has defended the action it took against crypto exchange Binance and not the collapsed crypto platform FTX. The central bank also warned that cryptocurrencies are \u201chighly volatile and many of them have lost all value.\u201d<\/strong><\/p>\n

Singapore\u2019s Central Bank Clarifies Its Stance on Binance and FTX<\/h2>\n

The Monetary Authority of Singapore (MAS), the country\u2019s central bank, issued a press release this week \u201cto address some questions and misconceptions that have arisen in the wake of the FTX.com (FTX) debacle.\u201d<\/p>\n

The central bank explained: \u201cA first misconception is that it was possible to protect local users who dealt with FTX \u2026 MAS cannot do this as FTX is not licensed by MAS and operates offshore.\u201d<\/p>\n

The MAS proceeded to justify the action it took against Binance and not FTX. The former was placed on the central bank\u2019s Investor Alert List (IAL) while the latter was not. The regulator clarified:<\/p>\n

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While both Binance and FTX are not licensed here, there is a clear difference between the two: Binance was actively soliciting users in Singapore while FTX was not.<\/p>\n<\/blockquote>\n

The MAS ordered Binance to cease<\/a> providing payment services to Singapore residents in September last year. A few months later, the crypto exchange shut down<\/a> its exchange services in the city-state.<\/p>\n

\u201cBinance in fact went to the extent of offering listings in Singapore dollars and accepted Singapore-specific payment modes such as Paynow and Paylah,\u201d the central bank stressed, adding that it received several complaints about Binance between January and August 2021. The MAS detailed:<\/p>\n

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MAS placed Binance on the IAL because it had solicited Singapore users without a licence. Further, on MAS\u2019 referral, the Commercial Affairs Department commenced investigation into Binance for possible contravention of the Payment Services Act (PS Act). There was no reason to place FTX on the IAL as there was no evidence that it had contravened the PS Act.<\/p>\n<\/blockquote>\n

Commenting on FTX specifically, the regulator noted: \u201cThere was no evidence that it was soliciting Singapore users specifically. Trades on FTX also could not be transacted in Singapore dollars. But as in the case of thousands of other financial and crypto entities that operate overseas, Singapore users were able to access FTX services online.\u201d<\/p>\n

A recent study indicated<\/a> that when Binance shut down services in Singapore, its users switched to FTX. Subsequently, more users from Singapore were using the FTX.com website before the exchange collapsed than from any other country, except South Korea.<\/p>\n

Singapore\u2019s Central Bank Warns About the Risks of Investing in Crypto<\/h2>\n

Noting that \u201cThe most important lesson from the FTX debacle is that dealing in any cryptocurrency, on any platform, is hazardous\u201d and investors \u201ccan lose all their money,\u201d the MAS warned:<\/p>\n

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Crypto exchanges can and do fail. Even if a crypto exchange is licensed in Singapore, it would be currently only regulated to address money-laundering risks, not to protect investors.<\/p>\n<\/blockquote>\n

Furthermore, the MAS emphasized: \u201cCryptocurrencies themselves are highly volatile and many of them have lost all value \u2026 The ongoing turmoil in the crypto industry serves as a reminder of the huge risks of dealing in cryptocurrencies.\u201d<\/p>\n

Following the meltdown of FTX, Singapore government\u2019s Temasek wrote down<\/a> its $275 million investment in the crypto company. Singapore has been trying to reduce risks for retail crypto investors with restrictive rules<\/a>.<\/p>\n

What do you think about the clarification by the Monetary Authority of Singapore? Let us know in the comments section below.<\/strong><\/em><\/p>\n

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\nKevin Helms <\/h6>\n

\nA student of Austrian Economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open-source systems, network effects and the intersection between economics and cryptography.

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Image Credits<\/b>: Shutterstock, Pixabay, Wiki Commons<\/em><\/p>\n

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