Singapore's Central Bank Defends Putting Binance On Watchlist
Singapore’s central bank has responded to criticism of its treatment of two of the world’s largest crypto exchanges, explaining why Binance was on an investor watch list while FTX, which has filed for bankruptcy, was not, Michelle Toh and Diksha Madhok reported for CNN Business.
Photo Insert: TMAS said the lesson from the FTX debacle is that dealing in any cryptocurrency, on any platform, is hazardous.
On Monday, the Monetary Authority of Singapore (MAS) said it wanted to clear up “questions and misconceptions” that had come up since the implosion of FTX, which was one of the biggest cryptocurrency firms globally.
MAS had received queries on why Binance, the world’s top exchange, had been placed on its investor alert list, which warned users that it was not licensed or regulated locally.
“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,” the MAS said.
“With regard to FTX, there was no evidence that it was soliciting Singapore users specifically.”
Before its implosion, FTX was valued at $32 billion and had recruited high-profile backers including SoftBank and Tiger Global, as well as celebrities such as Tom Brady, Gisele Bündchen, and Naomi Osaka. Now, they are running for cover.
Investor Sequoia Capital and Singapore’s state-owned investment firm, Temasek, have each written down the value of their FTX stakes down to $0. Singapore’s central bank said that contrary to what some had suggested, the goal of its investor watch list was to clarify whether financial entities were licensed in the country or not and not to provide alerts on offshore crypto exchanges.
MAS said the lesson from the FTX debacle is that dealing in any cryptocurrency, on any platform, is hazardous.
“The ongoing turmoil in the crypto industry serves as a reminder of the huge risks of dealing in cryptocurrencies,” the MAS said. “There is no protection for customers who deal in cryptocurrencies. They can lose all their money.”
Regulators are expected to step up their oversight of the industry as a result of its worst-ever turmoil. Dozens of regulatory agencies around the world have been in contact with FTX specifically over its collapse, pointing to the potential scope of its impact across jurisdictions.
Singapore has emerged as a regional hub for cryptocurrency startups. However, officials there have increased calls for greater regulation of the industry, with the MAS releasing new proposals in October that it said would “reduce risks to consumers from cryptocurrency trading.”