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Applying For A Cryptocurrency License in Singapore
For those intending to set up a cryptocurrency license in Singapore, you will need a business license to do so. This guide explains how you can apply for your cryptocurrency license in Singapore.
But First, What Is Cryptocurrency?
Cryptocurrency is a form of virtual currency. Yes, you are able to use it as a medium of exchange. You can transact safely knowing that it is secured and structured by cryptography.
Like other forms of currency, cryptocurrency can also be used for online payments. You can use them to pay for goods or services that are purchased online.
Now, What Is A Cryptocurrency License?
Online transactions require security. That is the highest priority. A cryptocurrency license gives you that. It is a document that gives authority to an entity. In this case, the entity would be your business.
With a license, you can conduct regulated cryptocurrency business transactions that are in accordance with Singapore law. With a license, you can conduct businesses as a cryptocurrency exchange operator or depository wallet operator.
What Type of Cryptocurrency License Should I Apply For?
That would depend on the nature of your business. There are two types of cryptocurrency licenses:
- A Cryptocurrency Exchange License
- A Cryptocurrency Wallet License
An exchange license is for businesses who want to provide exchange services. This is for those who are keen on trading cryptocurrencies. The wallet license, on the other hand, lets you conduct business as a wallet service provider. This will allow you to provide e-wallet services or token wallet services.
Where Can I Apply for A Cryptocurrency License in Singapore?
The Monetary Authority of Singapore (MAS) issues the cryptocurrency licenses in Singapore. To apply for a cryptocurrency license, you would need to go through them per the Singapore Payment Services Act 2020.
Getting a cryptocurrency license is highly encouraged. With the license, you are eligible for tax incentives and asset protection in Singapore. Several forms of company ownership also become available to you once you have obtained your cryptocurrency license.
What Documents Do I Need to Apply for A Cryptocurrency License in Singapore?
To apply for your license, you must meet the following requirements:
- Provide a business plan
- Have a clear financial forecast
- Provide a local office address
- Have a company webpage
- Provide financial statements
- Provide an AML/CTF policy
- Have an insurance policy
- Be clear of criminal charges
- Have a clean credit record
Additionally, there are other compliance requirements that must be met before you apply for your cryptocurrency license:
- You must develop an internal working policy for your assets
- You must have an appointed authorised person who complies with the regulation norms
- You must keep detailed records of all your transactions
Need More Advice?
Do you need more advice about your cryptocurrency license application? We’re here to help. Book a consultation with our friendly team today and let’s help you get your business up and running. Contact us today.
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Frequently Asked Questions
What are the key reasons to apply for a cryptocurrency license in Singapore?
Answer: Singapore is a leading financial hub with a supportive regulatory environment for cryptocurrency businesses. Obtaining a cryptocurrency license provides legitimacy, access to tax incentives, and asset protection, making it an attractive location for cryptocurrency ventures.
What are the essential steps to apply for a cryptocurrency license in Singapore?
Answer: The essential steps include preparing a business plan, financial forecast, securing a local office address, creating a company website, and gathering necessary documents such as AML/CTF policy, financial statements, and insurance policy. Compliance with the Payment Services Act 2020 is also required.
What types of cryptocurrency licenses are available in Singapore?
Answer: There are two main types of cryptocurrency licenses: the Cryptocurrency Exchange License for trading services and the Cryptocurrency Wallet License for providing e-wallet or token wallet services.
What challenges might entrepreneurs face when applying for a cryptocurrency license in Singapore?
Answer: Entrepreneurs may face challenges such as meeting stringent compliance requirements, managing financial risks, and maintaining detailed transaction records. Additionally, aligning with regulatory norms and ensuring robust internal policies can be demanding.
How important is financial planning when applying for a cryptocurrency license in Singapore?
Answer: Financial planning is crucial as it ensures that the business can sustain itself, meet regulatory requirements, and manage risks effectively. A clear financial forecast is a necessary component of the application process.
What role does the business plan play in the success of obtaining a cryptocurrency license?
Answer: A comprehensive business plan outlines the strategic direction, operational framework, and financial projections of the business, which are critical for gaining regulatory approval and attracting potential investors.
How can 3E Accounting assist in applying for a cryptocurrency license in Singapore?
Answer: 3E Accounting can provide expert guidance on the application process, assist with compliance and regulatory requirements, and offer strategic advice to ensure a smooth and successful application.
What are the employment requirements for foreign entrepreneurs applying for a cryptocurrency license in Singapore?
Answer: Foreign entrepreneurs may need to appoint local directors or authorized representatives and ensure compliance with Singapore’s employment regulations. It’s important to understand the legal requirements for hiring and operating in Singapore.
