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Singapore’s fiat regulations for digital currencies

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The Deputy Prime Minister of Singapore has tried to illuminate the country’s position on digital currencies concerning its illegal tax avoidance laws. Talking esrlier this week, Mr. Tharman Shanmugaratnam emphasized that Singapore’s financial controller won’t recognize digital forms of money and fiat monetary standards.

With Singapore progressively being viewed as a potential goal for digital currency, organizations looking to escape the regulatory vulnerability related with China, Singaporean authorities are confronting expanded examination in regards to the country’s juridical device relating to cryptographic forms of money.
Earlier this week, Singapore’s deputy prime minister and Chairman of the Monetary Authority of Singapore (MAS), Mr. Tharman Shanmugaratnam, looked to illuminate Singapore’s against tax evasion (AML) and countering the financing of fear based oppression laws (CFT) with respect to digital currency.“When it comes to money laundering or terrorism financing, Singapore’s laws do not make any distinction between transactions effected using fiat currency, virtual currency or other novel ways of transmitting value.”
Mr. Shanmugaratnam emphasized that the MAS, Singapore’s money related controller and national bank, won’t recognize exchanges led in fiat and digital money in trying to implement its AML/CTF laws, including that every single financial instituition will be liable to similar directions. The MAS administrator likewise expressed that The Commercial Affairs Department will be engaged to explore and arraign cases identifying with illegal tax avoidance or psychological oppressor or terrorist financing.

The MAS chairman, however, perceived that the regulation of virtual currency exchanges may posture challenges not related with checking fiat money circulations. .
Mr. Shanmugaratnam emphasized the pseudo-anonymous qualities of cryptocurrency, adding that the absence of a centralized clearing further complicates the challenge of regulating transactions executed using virtual currencies.

In order to mitigate said challenges, the MAS will seek to impose anti-money laundering and anti-terrorist financing requirements on intermediaries that exchange fiat for virtual currencies – such as exchanges and brokers. Singapore’s financial regulator is presently conducting public consultation relating to the proposed Payment Services Bill intended to empower MAS to have greater jurisdiction over cryptographic money exchanges and brokerages.
Mr. Shanmugaratnam’s remarks include an obvious change in the position of the MAS concerning the cryptographic forms of money, as the MAS administrator has already expressed that the MAS won’t look to manage virtual monetary standards, aside from when the exercises identifying with digital currencies directly fall under the juridical domain of the MAS. By contrast, Mr. Shanmugaratnam’s current explanation shows that the MAS is looking to extend its administrative order to more noteworthy screen organizations that change over fiat into cryptographic forms of money.

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Australian Taxation Office warned against crypto retirement funds

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Regulatory authorities around the world have tighten the grip on crypto projects. Taxation authorities like Internal Revenue Service (IRS) and Australian Taxation Office (ATO) are the latest to join the list with strong initiatives.

Australian Taxation Office recently sent warning letters to the investors who have invested a large part of their retirement savings in crypto related funds. ATO sent these letters in order to warn investors against high risk investments like crypto. One of the key responsibilities of regulatory authorities and taxation authorities is to keep investors away from high risk investment schemes.

A spokesman from ATO told local media that “We have already seen instances in 2018 where investors lost significant amount of their retirement fund in crypto investments, so it’s our duty to make them aware about the kind of risk crypto market posses”. The spokesman further explained that they are also against the huge exposure in any single asset class. “We are not saying that we are all and all against the crypto market or crypto assets, but we are more concerned about the kind of exposure these crypto retirement funds have in single crypto asset like Bitcoin”

“If an investor is putting more than 90% of his retirement savings in crypto then obviously it is at high risk and that’s what we discourage, we have no issues in diversified portfolios but if crypto retirement funds are having 100% exposure in crypto assets then we have to warn investors about the potential losses.

Self-Managed-Super Funds (SMSFs)

SMSFs are type of retirement accounts privately managed by individuals rather than the institutions or regulated financial companies. Australian Securities and Investments Commission also supports ATO’s decision, in a recent statement ASIC said

“Be wary of services offering to establish an SMSF for you in order to gain exposure to cryptocurrencies. Not only does operating an SMSF involve significant time, skills and responsibility, you may also be putting your retirement savings at risk”

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Morning Crypto Roundup: Coinbase, Bakkt, Binance in news

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“Coinbase seeing $200-400 million in new crypto deposits every week”: Armstrong 

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CEO of Coinbase, Brian Armstrong says that “Adoption of crypto by Institutions is no more an uncertainty. The question was valid about 12 months ago, but now everything has changed as we’re seeing $200-400 million a week in new crypto deposits from institutional clients”

In a recent tweet, Armstrong further says that trust and safety means a lot to crypto investors and Coinbase is on a mission to provide safe infrastructure to institutional clients in order to increase adoption.

Coinbase has completed acquisition of Xapo which helped them in institutional business. In a recent blogpost, Coinbase further mentioned that in just one year of launch, Coinbase custody has reached a staggering number of $7 billion of assets under custody, stored on behalf of 120 clients from 14 different countries.

The highlight of today’s tweet from Brian Armstrong was the numbers from Institutional investors. Safety have always been a big issue for investors and that’s why there were lot of discussions regarding adoption of crypto at Institutional level, but with $200 – 400 million coming into Coinbase every week, we can easily say that crypto adoption at institutional level is no more a question, it’s a reality.

The way forward 

We already discussed about the importance of safety of funds in crypto market, but in order to increase adoption, crypto market must create new traders. Traders love leverage, borrowing and lending which allows them to trade the market even with limited resources. Retail forex market is a prime example of such facilities. Coinbase did mentioned in the blogpost that they are excited to explore new ways to monetize and leverage crypto assets like borrowing and lending.

Bitcoin ETF

Decision about the Bitcoin ETF by securities and exchange commission is pending in October. Exchange traded fund approval from SEC can open new doors for crypto adoption at an institutional level.

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