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The central bank of Singapore is moving to regulate the payment providers, including the cryptocurrency exchanges operating in the city-state.
According to a report of the website Coindesk, the proposed regulatory framework would require the companies working as payment providers, will have to obtain a license from the Monetary Authority of Singapore (MAS).
The document divides payment activities into several categories. The cryptocurrency exchanges are covered by the category of “startups that provide money transmissions and conversion services”. This would mean that both the local exchanges like Quoine, Bitcoin Exchange Singapore and CoinHako, as well as foreign exchanges operating in Singapore, like Coinbase, BitX, etc. will have to apply for a license from MAS.
“The scope of currency conversion activities is intended to encompass the business of exchanging of currencies at a rate of exchange. In addition, it is likely that under the [Proposed Payments Framework], virtual currency intermediaries which buy, sell, or facilitate the exchange of virtual currencies, such as bitcoin, will also be considered to undertake [money transmissions and conversion services],” the MAS said.
The draft document also proposes the creation of a National Payments Council, which would include representative of the payments and digital currencies industries and government officials.
The document is up for public discussion and feedback from the interested parties until October 31.
Singapore is among the vanguard of countries adopting new financial technologies, cryptocurrencies and their underlying technologies, much like Japan, whose parliament passed regulation legislation for cryptocurrency exchanges recently. Meanwhile, one of the leading Bitcoin exchanges of Singapore, Quoine, raised $20 million and announced it will be seeking regulation in Japan.
Earlier this year Singapore government agencies teamed up with IBM to develop blockchain-based financial applications.
In August, the Singaporean banking society, the United Overseas Bank (UOB) launched its first accelerator program FinLab, which focuses on fintech solutions, smart contracts and blockchain systems.