Singapore, 14 November 2022... The Monetary Authority of Singapore (MAS) said today, in response to media queries, that FTX.com does not operate in Singapore. FTX.com is neither licensed nor exempted from licensing in Singapore. It is not possible, however, to prevent Singapore users from directly accessing overseas service providers. FTX.com was therefore able to onboard Singapore users. MAS has consistently reminded the public of the risks of dealing with unlicensed entities.
2. Questions have been raised as to whether “banning” Binance and placing it on the Investor Alert List (IAL) have led Singapore users to invest through FTX.com. Binance was not banned from operating in Singapore. Binance did not have the requisite licence to solicit customers from Singapore and had to cease doing so. MAS lists on the IAL entities that may be wrongly perceived as being regulated by MAS, as was the case for Binance.com. It would not be meaningful for MAS to list all unlicensed entities on the IAL. MAS did not have cause to list FTX on the same basis as Binance.
3. Questions have also been raised as to why FTX.com’s Singapore users have not migrated to its subsidiary in Singapore, Quoine Pte. Ltd (Quoine), which operates the Liquid exchange in Singapore. Quoine is currently exempt from licensing while its licence application is under review. MAS is carefully reviewing the application, taking into account recent developments. The funds of Singapore investors in FTX.com are not parked under Quoine as FTX.com and Quoine operate as separate legal entities. Singapore users have the choice to deal with either FTX.com or Quoine. MAS has not required FTX.com to migrate Singapore users to Quoine.
4. Digital payment token service providers licensed by MAS under the Payment Services Act are regulated for money laundering and terrorism financing risks as well as technology risks, but not safety and soundness. They are not subject to risk-based capital or liquidity requirements, nor are they required to safeguard customer monies or digital tokens from insolvency risk. This is similar to the approach taken in most jurisdictions. It is also why MAS has been continually reminding the general public since 2017 that dealing in cryptocurrency is highly hazardous.
5. MAS issued a consultation paper on 26 October 2022 proposing regulatory measures to reduce risks to consumers from cryptocurrency trading. Notwithstanding these measures, consumers must continue to exercise utmost caution when trading in cryptocurrency. Regulations cannot protect consumers from losses arising from the inherently speculative and highly risky nature of cryptocurrency trading.