Spot Bitcoin ETFs Face Restriction in Singapore Despite SEC Approval
In a move that contrasts with recent developments in the United States, the Monetary Authority of Singapore (MAS) has announced that it will not permit the listing of spot Bitcoin exchange-traded funds (ETFs) in the country. This decision comes despite the U.S. Securities and Exchange Commission (SEC) recently approving the launch of several spot Bitcoin ETFs.
Singapore’s Stance on Cryptocurrencies
According to the MAS, cryptocurrencies, including Bitcoin, do not meet the criteria for qualified assets within the context of ETFs. A spokesperson from the regulatory authority clarified that collected investment schemes (CIS), which fall under the Securities and Futures Act regulation, include ETFs but don’t include Bitcoin or any other cryptocurrency.
The spokesperson further explained that the local brokerages have limitations on the types of assets, and Bitcoin and other digital payment tokens weren’t deemed qualified for retail investors due to their high volatility. The spokesperson added, “Cryptocurrency trading is inherently highly volatile and speculative, unsuitable for retail investors. Those who still choose to trade Bitcoin ETFs in overseas markets should exercise extra caution”.
Despite the restrictions, retail investors in Singapore can still trade spot Bitcoin ETFs listed overseas through local brokerages. Capital market intermediaries licensed by the MAS can offer overseas market-related investments while ensuring adequate risk disclosure and appropriate customer suitability assessments. However, investors are advised to consider the additional risks associated with trading in overseas markets.
U.S. Spot Bitcoin ETFs
On January 10, the U.S. SEC approved 11 spot Bitcoin ETFs, including major contenders like Grayscale’s GBTC, BlackRock’s IBIT, and ARK 21Shares ARKB. Despite the approval, SEC Chair Gary Gensler stated that the agency “did not approve or endorse Bitcoin,” adding that investors “should remain cautious about the myriad risks associated with Bitcoin and products whose value is tied to crypto”.
Impact on Asia
The SEC’s decision has sparked discussions about the potential impact on crypto development in Asia. Some believe that the U.S. ETF approval will positively impact the region more than others due to the regulatory clarity and willingness from governments and regulators to build this ecosystem. However, the recent decision by the MAS indicates a more cautious approach towards cryptocurrencies in some parts of Asia.
While the U.S. has taken a significant step towards mainstream acceptance of Bitcoin with the approval of spot Bitcoin ETFs, Singapore’s decision not to permit the listing of these ETFs highlights the ongoing global debate about the role and regulation of cryptocurrencies. As the situation continues to evolve, investors are advised to exercise caution and stay informed about the regulatory landscape in their respective jurisdictions.
Angel Marinov is the Managing Editor at Coinlabz. With extensive knowledge of crypto payments and blockchain use cases, Angel is a trusted source of accurate and timely information