Coinbase Wins Crypto License in Singapore as City-State Aims to Become Web3 Hub
Brian Armstrong, co-founder and CEO of Coinbase.
Coinbase, the world’s second-largest crypto exchange co-founded by billionaire Brian Armstrong, has been granted permission to operate in Singapore as the city-state seeks to strengthen its position as an Asian digital asset hub.
The Nasdaq-listed company announced on Tuesday that its Singapore unit had received in-principle approval from the Monetary Authority of Singapore (MAS) to provide digital payment card services in the country.
“We see Singapore as a strategic market and a global hub for Web3 innovation,” Hassan Ahmed, Southeast Asia regional director at Coinbase, said in a statement. “This milestone further signals our commitment to advancing the local and regional crypto ecosystem.”
Singapore has stated its intention to become a fintech hub in Asia and quickly adopted a licensing regime that attracted global leaders such as Crypto.com and Huobi to set up business units in the city-state. However, the recent collapse of Three Arrows Capital, a high-profile crypto hedge fund incorporated in Singapore, has highlighted the risks inherent in the crypto industry.
Following the liquidation of Three Arrows Capital, MAS said it is considering making it more difficult for retail investors to trade crypto, including restrictions on the use of leverage. The plan was followed by the central bank’s move to require crypto firms to be licensed locally even if they only serve markets overseas and its ban on crypto advertising to the public.
MAS has implemented a lengthy due diligence process when awarding licenses for crypto players. Regulators have so far given less than 20 green lights to around 180 applicants since implementing the licensing regime in January 2020. Among the beneficiaries is Hodlnaut, the struggling crypto lender that was recently granted protection from creditors. Others include the brokerage arm of DBS Bank and exchange giant Crypto.com.
Calling MAS a “lighthouse regulator for the region,” Coinbase said it has expanded its presence in Singapore. The company has invested in more than 15 Singapore-based crypto startups in the past three years, and has built a team there to drive investment activity in the Asia-Pacific region.
Founded in 2012 in San Francisco, Coinbase said it now serves 103 million users in more than 100 countries. The company has recently followed the broader trend of other crypto companies to cut costs by laying off part of its workforce amid an industry downturn. It continues to be the world’s second-largest crypto exchange, processing $1.6 billion in spot trades of digital assets over a 24-hour period on Tuesday, according to tracker Coingecko.
