27 September 2021 Update: Binance.com To Suspend Key Offerings for Its Singapore Users
At 5.37pm today (27 September 2021), Binance.com made the announcement that it will suspend key offerings for its Singapore users from 26 October 2021, 12pm Singapore time.
Sadly, it looks like Binance.com’s time in Singapore is up as the suspension of the key functions means that most users based in Singapore will have limited use for Binance.com.
Granted, you can still trade options, futures and use the exchange’s earn features. But, the process will be quite cumbersome.
So if you are a Binance.com user, please do follow Binance’s advice to stop all related trades and withdraw all your fiat and cryptocurrency assets by 26 October 2021, 12pm Singapore time.
Although you have about a month from the time of writing, this should be done as soon as possible so that you will not be affected by any potential trading disputes.
Here is what you need to know!
As the situation is still developing, do save this article as we will be updating it if once new information is released.
TL;DR: Binance.com To Suspend Key Offerings for Its Singapore Users
6 Sep 2021 Update: Binance.com to Stop Offering Select Products and Offerings in Singapore After MAS Warning
So here is what happened previously.
In an interview with CNA last Thursday (2 September 2021) a MAS spokesperson clarified that:
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Binance.com is not licensed or regulated by MAS to supply any form of payment services in Singapore. Binance.com has also not applied for a licence under the Payment Services Act (PS Act).
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Binance, the operator of Binance.com, may have breached the PS Act by providing payment services without an appropriate licence.
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MAS has ordered Binance.com to cease providing payment services that are regulated under the PS Act to Singapore residents and cease soliciting such business from Singapore residents.
After MAS issued the warning, Binance made an announcement on 5 September 2021, stating that it will stop offering the following services and offerings in Singapore from Friday (9 September 2021), 12pm Singapore time (UTC+8):
- Singapore Dollar (SGD) trading pairs.
- SGD payment options (e.g. on its peer to peer (P2P) exchange).
- The Binance app will be removed from Singapore’s Google Play Store and iOS store.
- Binance will suspend any official Telegram or online communication channels in Singapore.
Binance is also advising users to ‘complete all related P2P trades and remove any related trade advertisements by Thursday (21 September 2021), 12pm Singapore time (UTC+8) to avoid potential trading disputes.’
Also, on Thursday afternoon (2 Sep 2021), cryptocurrency exchange Binance.com was placed on the Monetary Authority of Singapore’s (MAS) investor alert list.
For context, MAS places companies on this list for giving the public the wrong impression that they are licensed or regulated by the MAS to provide regulated financial services in Singapore even if they do not have a license or have not been exempted from licensing by MAS.
What is Binance.com
Binance is the world’s biggest blockchain and cryptocurrency infrastructure with a financial product suite that includes the largest cryptocurrency exchange by volume at the time of writing.
This exchange is non-other than Binance.com: the international cryptocurrency exchange that Binance operates.
Also, the company is domiciled in the Cayman Islands and was actually founded in 2017 by Changpeng Zhao (CZ), who started his career by building high-frequency trading software for stockbrokers.
Initially, the company was based in China. But, it had to move its headquarters out of China due to China’s crackdown on cryptocurrency.
As of today, the company claims it has no headquarters in a specific country or region.
However back in May 2021, Bloomberg reported that Binance is under investigation from the US Internal Revenue Service and the US Department of Justice on claims of tax offences and money laundering.
But on balance, the investigation is still ongoing and the company claims to be collaborating with law enforcement agencies to fight bad actors.
The company also recently faced some regulatory trouble in the UK as the country’s Financial Conduct Authority (FCA) announced a ban on Binance’s UK arm Binance Markets from operating any ‘regulated activity in the U.K.’ due to its futures in margin trading.
In addition, countries like Italy, Hong Kong and Malaysia have clamped down on Binance for providing certain services even though they were not authorised to do so.
To be clear, Binance.com and Binance.sg are considered separate entities as both exchanges do not offer products or services on each other’s platforms.
What is Binance.sg (Binance Singapore)
So what’s the difference?
Well, Binance.sg is run by Binance Asia Services (BAS), the Singaporean branch of Binance that operates independently of Binance.com.
In an interview with The Buisness Times, Binance.sg stated that:
“Binance Singapore (Binance.sg) is a separate legal entity from Binance.com with its own local executive and management team and does not offer any products or services via the Binance.com website or other related entities, and vice versa. Binance Singapore is solely focused on growing the Singapore cryptocurrency ecosystem and servicing users in Singapore,”
Binance.sg added that Binance.com being placed on the MAS investor alert list has ‘no direct impact’ on the services it provides, emphasising that Binance.sg is an independent entity.
But MAS has stated that BAS should ‘immediately begin an orderly suspension’ of any transfers of Digital Payment Tokens (DPTs) between Binance.sg and Binance.com.
As such in the near future, users based in Singapore will not be able to transfer cryptocurrencies or funds between Binance.sg and Binance.com.
But, you should know that Binance.sg has been granted an exemption from holding a licence under the PS Act.
Cryptocurrency Regulation in Singapore
Speaking of the PS Act, MAS implemented it in a bid to regulate the cryptocurrency industry in Singapore. The act came into effect on 28 January 2020.
For more on regulation do check out our guide:
will have to be either licensed by MAS or granted the status of an exempt payment service provider.
Thus, as most cryptocurrencies and stablecoins fall under the category of either e-money or DPTs, the majority of cryptocurrency exchanges or companies would require either MAS Standard Payment Institution Licence or a Major Payment Institution Licence to operate in Singapore.
On the same day, MAS rolled out MAS Notice PSN02 (Prevention of Money Laundering and Countering the Financing of Terrorism – Digital Payment Token Service).
This notice outlined the extensive anti-money laundering (AML) and countering the financing of terrorism (CFT) requirements that DPT service providers had to comply with to prevent the illicit flow of funds in and out of Singapore via DPTs.
A year later on 4 January 2021, MAS passed the Payment Services (Amendment) Bill in parliament.
The amendments were made to comply with international standards and implement more robust AML and CFT measures.
In addition, the amendments expanded the definition of DPT services to include:
- Transfer of DPTs
- Provision of custodian wallet services for DPTs
- Facilitating the exchange of DPTs without possession of money or DPTs by the DPT service provider.
This is in addition to the previous definitions which classified DPT services as any service of dealing in DPTs and any service of facilitating the exchange of DPTs.
Thus, any DPT providers providing the above mentioned DPT services will require a license from MAS to operate in Singapore under the PS Act and comply with the financial authority’s AML/CFT regulations.
The amended bill also grants MAS power to implement:
- User protection measures on certain DPT service providers to ensure the safekeeping of customer assets held by the DPT service provider, where necessary
- Measures on certain DPT service providers where it is in MAS’ view necessary or expedient in the interest of the public or a section of the public, the stability of the financial system in Singapore, or the monetary policy of MAS.
And as mentioned earlier, if DPT providers deal in capital market products like securities tokens, they will have to comply with the SFA.
However, at the time of writing, the amendments to the PS Act have not taken effect will only come into operation on an unannounced date.
But currently, there is little to no legislative protection for consumers. MAS is not required to safeguard your cryptocurrency or ensure that each cryptocurrency transaction is processed in the right way.
This is made clear with this advisory that MAS requires DPT service providers to show to customers:
- Your DPT service provider is licensed by MAS to provide DPT services.
Please note that this does not mean you will be able to recover all the money or DPTs you paid to your DPT service provider if your DPT service provider’s business fails. - You should not transact in the DPT if you are not familiar with this DPT.
Transacting in DPTs may not be suitable for you if you are not familiar with the technology that DPT services are provided. - You should be aware that the value of DPTs may fluctuate greatly.
You should buy DPTs only if you are prepared to accept the risk of losing all of the money you put into such tokens.
Although Binance.sg has been granted an exemption from holding a licence under the PS Act, Binance.sg in its current state cannot be considered as a MAS regulated entity just yet.
But on balance, Binance.sg did appoint the ex MAS director of corporate finance Richard Teng as the company’s new chief executive in August 2021. Before his MAS stint, Teng was also employed as the chief regulatory officer for the Singapore Exchange (SGX: S68).
In addition, MAS announced in June 2021 that it reviewed BAS and other entities applications for a licence to offer DPT services in Singapore under the Payment Services Act.
At the time of writing, only two entities, DBS Vickers (DBS’s brokerage arm) and Australian cryptocurrency exchange Independent Reserve have received in-principle approval from MAS to offer DPT services in Singapore.
And only one entity, digital payments provider FOMO Pay has obtained MAS licenses to offer DPT services in Singapore.
What Should Binance.com Investors Do?
If you are a Binance.com user, please do follow Binance’s advice to stop all related trades and withdraw all your fiat and cryptocurrency assets by 26 October 2021, 12pm Singapore time.
Although you have about a month from the time of writing, this should be done as soon as possible so that you will not be affected by any potential trading disputes.
You can transfer your cryptocurrency to other cryptocurrency exchanges like:
After transferring them out from Binance.com, you can proceed to cash out your cryptocurrencies to fiat on a cryptocurrency exchange like Gemini, Coinhako or Crypto.com that supports SGD withdrawals.
But, do note that these transfers will incur trading and network fees.
You can even convert your cryptocurrencies to stablecoins like Binance USD (BUSD) and withdraw it as fiat (USD) directly to multi-currency accounts like Instarem or the DBS Multiplier account via the Society for Worldwide Interbank Financial Telecommunication (SWIFT) network.
But do note that Binance charges US$15 (S$20.14) for each withdrawal.
Transferring Your Cryptocurrencies to a Cold Hardware Wallet
There is another option.
In the world of cryptocurrencies and the blockchain, there is a popular saying:
Not your keys, not your coin.
In other words, when you are trading cryptocurrencies on any centralised cryptocurrency exchanges like Bianance.com and Binance.sg, you are handing over the private keys for your cryptocurrencies and entrusting them to a third party.
Ultimately, the one who is holding the private keys to the cryptocurrencies decides how it’s spent.
If you are really spooked by recent events, you should consider transferring your large cryptocurrency holdings onto your own cryptocurrency cold wallet where you are holding on to the private keys.
This will give you complete control over your cryptocurrencies.
Cold wallets keep your cryptocurrencies safe as well as they are not connected to the internet which makes them harder to hack.
Here are a few cold cryptocurrency hardware wallets to consider:
Disclaimer: The information provided by Seedly serves as an educational piece and is not intended to be personalised investment advice. Seedly does not recommend that any cryptocurrency should be bought, sold, or held by you. Readers should always do their own due diligence and consider their financial goals before investing in any investment product and consult your financial advisor before making any investment decisions.
