Recently, Singapore envisioned being the global crypto hub. Not long ago, the city-state secured its slot among the preferred Fintech destinations for foreign investors. It is due to its favourable taxation system and regulatory framework. This gives confidence in the industry while protecting the customers’ safety.
The Monetary Authority of Singapore is the primary regulator of the nation’s finance and provides for creating cryptocurrency businesses. In 2017, the MAS began enabling legislation regulating the issuance and use of virtual coins. The MAS said its crypto regulations would include a ‘stringent’ licensing process this year. MAS believes that stricter rules could reshape Singapore as a global digital asset hub.
Ideas for Cryptocurrency Business
Cryptocurrency presents an opportunity for businesses to create new and innovative offerings around digital assets. Here are some of the options to consider in establishing a crypto business.
- Crypto Exchange is a platform on which a person can purchase and sell cryptocurrency. It enables the exchange and transaction of different cryptocurrencies from one merchant to another.
- Non-Fungible Token Business is one of the most popular cryptocurrency business opportunities. Its value for business allows the creation of a unique asset, enabling your business to give an exclusive customer experience and offerings. NFTs became a new tool to generate unique selling propositions, expand market reach, and increase brand loyalty and awareness.
There are other business ideas, such as crypto crowdfunding and blockchain business which you can explore. As the adoption of digital assets accelerates, companies are investing in innovative products and services, fueling new business opportunities.
5 Reasons to Set Up Cryptocurrency Company
There are numerous benefits to setting up a cryptocurrency company in Singapore. Here are five reasons Singapore is an excellent place to set up a cryptocurrency company.
- Pro-business environment
Singapore is well-known for its speed and ease of doing business. The government also provides attractive business schemes and grants for innovative startups. In other countries, setting up a business takes up to a few weeks. But in Singapore, the time needed can be anywhere from 1 day to a few days. The corporate compliance rules are easy to follow.
- Regulated by law
The Monetary Authority of Singapore regulates digital assets-related services and service providers on an activity basis rather than an entity-based approach to mitigate risks posed by specific activities. It has granted licences or in-principle approvals to 11 digital payment tokens service providers in the last two years. Regulation has been limited to anti-money laundering, technology risk, and access to the retail public.
- Supported by the Government
Blockchain, the concept of tokenisation, and cryptography make the crypto ecosystem a potentially transformative technology. It enables high-value assets to be fractionalised, unlocking new economic value, enhancing financial inclusion, and enabling more seamless and efficient financial services. For this reason, Singapore planned to create an adoption-driven and pro-crypto climate in the city-state, aiming to become a major global crypto hub in the future.
- Forward-looking banking system
As Singapore’s government continues to keep its cryptocurrency legislation updated, its financial sector can tap into the blockchain potential and pave the way for its integration with the city-state’s banking system. This gives startups an immense opportunity to pitch and test their ideas.
- Highly skilled labour force
You will have no issues hiring literate and skilled employees as Singapore boasts a literacy rate of 97.13%. Upon completion of your business’s registration, you would be able to easily hire the right candidates to join your company.
Requirements in Establishing Cryptocurrency Business in Singapore
To open a cryptocurrency company in Singapore, you must first register one of the structure types recognized by Commercial Law. A financial company is required to obtain a special license, while an IT company does not need any special permit from the Monetary Authority of Singapore. All companies must act per the Anti-Money Laundering (AML) and Countering of Financing of Terrorism (CFT) policy.
Tax Obligation for Crypto Business
There is no capital gains tax in Singapore. Companies that buy crypto in Singapore and benefit from asset appreciation do not pay sales tax. However, if your business or profession involves trading for profit, you will be taxed at 17%. The tax obligation for gain or loss on disposal of digital tokens depends on whether it is capital or revenue in nature.
Singapore has been open to business incorporations. Because of the soaring investments in the financial technology sector, the city-state welcomes crypto company incorporation to encourage the growth of crypto or tokenised economy.
Corporate Services Singapore is an established company registration firm in Singapore that will help you register and manage your business.