Crypto Clients: Singapore to Issue New Vetting Guidance for Banks

• Singapore Working on New Guidance for Crypto Clients: Singapore authorities are currently working with banks and other lenders to set uniform standards for vetting cryptocurrency clients.
• Focus on Payments, Trading and Transfers of Assets: The initiative is set to cover stablecoin and NFTs as well as transferable gaming or streaming credits.
• Tighter Regulation Following Recent Turmoil: The guideline to be issued by Singaporean authorities could be considered a way of tightening regulation in the crypto space following the recent high-class collapses.

Singapore Working on New Guidance for Crypto Clients

Singapore authorities are currently working with banks and other lenders to set uniform standards for vetting cryptocurrency clients. Banks will decide whether they want to take on crypto clients based on their risk appetite. The initiative is set to cover stablecoin and non-fungible tokens (NFTs). It will also focus on firms that provide services in payments, trading, and transfers of these assets.

Focus on Payments, Trading, and Transfers of Assets

The guidance issued by Singaporean authorities will also cover transferable gaming or streaming credits. Banks would have the final say in deciding whether to accept cryptocurrency clients based on their risk appetite. Sources told Bloomberg that the project has been ongoing for roughly six months. An industry report outlining best practices in areas like due diligence and risk management will soon be released by the authorities.

Recent Turmoil Resulted in Losses

Last year, numerous crypto companies collapsed resulting in billions of dollars worth of losses. This includes FTX and Terraform Labs as well as Silvergate Bank, Signature Bank, Silicon Valley Bank (SVB). Some crypto customers are now scrambling for new banks due to these collapses.

No Stoppage from Government

At the moment, the Singaporean government does not stop banks operating within its jurisdiction from doing business with crypto companies. However, it has been reported that some local financial institutions have stopped offering banking services such as deposits and withdrawals related to cryptocurrencies due to concerns over money laundering risks associated with digital assets.

New Guideline Will Tighten Regulation The new guideline being worked on by Singaporean authorities may be seen as an effort towards tightening regulations within the crypto space following recent events . This could help ensure better security measures taken by financial institutions when dealing with digital asset service providers .