At the present moment Singapore is one the jurisdictions that establised regulation of cryptocurrency exchanges. During 2014-2018 the national regulator (MAS) issued interpretations expressing its position in relation to the cryptocurrencies, operating the ICO, as well as licensing the cryptocurrency exchange in Singapore, but at 2019 a new Pyment Service Act came in force that introduced 2 types of lcience: small payment institution and major payment institution. Nowadays, those who operate the exchange of cryptocurrencies shall obtain license in Singapore. Furthermore, if the company deals with cryptocurrencies that may be classified as securities, such entities shall btail license of stock exchange..
In which case the token will be considered as a security?
There are few cases in manuals of the Singapore regulator when placing tokens on a trade platform will be subject to regulation of the legislation on securities. Such tokens will be instruments of the capital markets. In particular, it is referred to tokens that are considered equivalent to:
It should also be noted that this list is not exhaustive.
If the potential crypto exchange acts as an intermediary in purchase and sale of tokens subject to the legislation on securities, it will be obliged to:
First, there are requirements related to the staff. The Chairperson, Chief Executive Officer (CEO) and members of the Board of Directors must be appointed to the relevant positions.
Second, the Board of Directors must include the following committees: the committee on appointing to the positions, the committee on issues of payment for the labor activity; the committee on issues of audits, the committee on resolution of conflict situation.
All cryptocurrency exchanges must act in accordance with the Anti-money laundering (AML) and the countering of financing of terrorism (CFT) legislation. In particular, the cryptocurrency exchanges must carry out the procedure for identifying the issuers of tokens prior to placing the corresponding tokens on their platform. As a rule, the burden of paying all associated financial costs rests with the issuers of tokens.
A license for exchange of cryptocurrencies in Singapore will be required if the cryptocurrency exchange will operate not only with cryptocurrencies, but also tokens that are subject to securities legislation.