After a positive outcome on Tuesday at the US Senate hearing on Virtual Currencies, another country, namely Singapore, has come forward and indicated that it will not be prohibiting cryptocurrency trading.
In a written response to Singapore’s members of parliament yesterday, the deputy prime minister and chairman of Monetary Authority of Singapore (MAS) has advised that there is no threat posed by cryptocurrencies and related trading activity to the financial system of Singapore.
He acknowledges that they will continue making Singaporeans aware of the risk associated with investing in cryptocurrencies, but doesn’t see a strong case in banning cryptocurrency in Singapore.
The MAS will also “be imposing anti-money laundering and countering the financing of terrorism (AML/CFT) requirements on the intermediaries that buy, sell or exchange virtual currencies. We set out this AML/CFT regulatory framework for virtual currency intermediaries last year as part of our public consultation on the proposed Payment Services Bill”. This is in an attempt to tackle money laundering, terrorist financing risks and illicit movement of funds.
Similar to the head of the Commodity Futures Trading Commission’s (CTFCs) testimony yesterday, he highlights the fact that blockchain technology could assist in developing “potentially useful applications in facilitating payments and trade settlements”. As such, the MAS has actually encouraged a number of blockchain experiments within the financial industry, as “some of these innovations could turn out to be economically or socially useful”.
This is a further indicator of a new approach that is arising when it comes to blockchain technology and the cryptocurrencies market. Rather than resist this innovation, countries need to adapt if they hope to keep up with the ever innovating world of blockchain and the benefits it could potentially provide.
After a month plagued with negative media, the cryptocurrency community will welcome news like this, which reaffirms their stance that blockchain technology is a definite part of our future. The discussions at the Senate meeting yesterday and this latest Singaporean parliamentary reply, should encourage other Governments to embrace this technology and be cautious when it comes to heavy regulations that may hinder innovation.