Crypto exchange gets Singapore nod on digital token services

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The Monetary Authority of Singapore has granted an “in-principle approval” under the Payment Services Act to cryptocurrency exchange Independent Reserve. (PHOTO: Getty Commercial)

By Joanna Ossinger

(Bloomberg) — The Monetary Authority of Singapore has granted preliminary approval for one of the city-state’s first cryptocurrency exchanges, allowing Independent Reserve to operate as a regulated provider for digital payment token services.

“To be one of the first cryptocurrency exchanges to be notified by MAS of our in-principle licensing approval is a reflection of the robustness of the policies, procedures and risk management systems that we have put in place,” Adrian Przelozny, chief executive officer of Independent Reserve, said in a statement. “It provides certainty for us as industry participants and security for our customers.”

Singapore’s central bank received 170 applications from digital payment token service providers, and recently notified several applicants that it’s prepared to grant them licenses under the Payment Services Act, a bank spokesperson said in a emailed statement Tuesday. Applicants who have received these notifications don’t yet hold licenses — these will be granted to an applicant provided it puts in place necessary measures to meet MAS’s requirements, the bank said.

A number of applicants haven’t met MAS’s standards in the areas of money laundering, terrorism financing and technology risk controls, according to the statement. About 30 applications, or 18% of the total, have been withdrawn after engagement with MAS, and two have been rejected.

“MAS takes a serious view of weaknesses in controls” and “will reject applicants who fail to meet the required standards,” the spokesperson said.

Several applicants are in the final stages of review for getting a license to operate as digital payment token service providers, Singapore’s Senior Minister and Chairman of the Monetary Authority of Singapore, Tharman Shanmugaratnam said in reply to a question in parliament on July 26. Around 90 service providers are operating under an exemption from holding a license, he said.

“While operationally, things will not change from receiving the in-principle approval, consumers will have the peace of mind that we and others that will receive their in-principle approvals have met MAS’s high standards,” Raks Sondhi, managing director of Independent Reserve in Singapore, said in an instant message on Tuesday.

Established in Australia in 2013, Independent Reserve embarked on its international expansion plans in late 2019, setting up its first overseas operations in Singapore to provide digital asset exchange and OTC trading services.

© 2021 Bloomberg L.P.

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