How to Set Up a Cryptocurrency Company
Singapore has a favourable taxation system and it also has a modern regulatory framework that covers a vast range of activities related to the financial system. This makes it a favourable destination for foreign investors all over the world. Singapore is among a handful of countries in the world to have a Cryptocurrency and Blockchain Industry Association that is dedicated to small and medium-sized enterprises operating in this field. There are experts at hand to assist those foreign investors who wish to incorporate a company in Singapore.
Cryptocurrency trading platforms in Singapore
There are two ways of getting cryptocurrency. You can either mine it or you can buy it on an exchange or trading platform. Singapore has many trading platforms including Coinbase, CoinHako Paxful, Indacoin, LocalBitcoins, Coinmama and FYB-SG. You begin by setting up your account and then you may proceed to buy cryptocurrency of your choice. When paying for your cryptocurrency you may use PayPal, a debit or credit card or bank transfer. Each of these methods attracts a given charge. Choose the method that is cheapest for you. You then carry out your trades by buying and selling your cryptocurrency of choice on the platform. The platforms charge a commission for executing trades.
Requirements for the formation of a cryptocurrency business in Singapore
If one wishes to open a cryptocurrency company in Singapore in this sector, they must first register one of the types of structures recognized by the Commercial Law. For a financial company to explore the cryptocurrency field, they require to obtain a special license. IT companies do not require any special permit with the Monetary Authority of Singapore for them to issue cryptocurrency.
All companies are required to comply with the anti-money laundering regulations imposed by the Monetary Authority of Singapore. These regulations are put into place so as to offer protection to the clients and investors in the instance of cryptocurrency funds.
The cryptocurrency field is one of the newest and most sought types of businesses to be started in the financial technology sector of Singapore. The Singapore government has made some interventions to help crypto startups open bank accounts locally. This is to mean they are not loosening any rules. They merely want to bring the crypto startups and the banks together to see if they can reach a form of an understanding. The government stepped in because the local crypto companies had complained of banks closing down their accounts which had brought their business to a grinding halt.
How Singapore became the global centre for crypto business development
Singapore began as a small island nation that gained independence from Malaysia. It quickly grew and it could make a highly developed and powerful country with the highest standards of living and progressive economy. In fact, this country is referred to as the largest financial areas in the world by many experts. The government is devoted to ensuring a successful development by catching up with technological progress. The country has a policy that is very loyal to innovations. This led to many investors choosing Singapore as a business area. Experts have lauded Singapore as a strong base for launching a crypto business.
Singapore also has comparatively softer legislation towards non-residents. The regulators in Singapore are interactive with the crypto enthusiasts. The only detractor to cryptocurrency businesses in Singapore is the banks. These display some peculiarities of Asian culture. Decisions take time and negotiations are gradual and they take several stages. The local banks are still suspicious of cryptocurrency transactions. They even block funds for significant periods of time. They then require extra reports on the purposes of the transactions as well as other information for them to allow the transaction to be carried out.
Characteristics of cryptocurrency trading
- Cryptocurrency markets are very volatile. The value of cryptocurrency is not based on fundamentals such as the case of stocks that are based on the intrinsic value of a firm.
- The use of leverage to trade is a very bad idea. Due to the volatility of the markets, they present a very high risk while trading. Therefore, you cannot compound on that risk by borrowing on a trade.
- You could very easily end up losing money you did not have in the first place. Therefore, Singapore could make one of the best places to set up a cryptocurrency company in Singapore.
- The government is sensitive to the needs of cryptocurrency businesses and they attract more foreign investments.
- Taxation in the country is flexible. For those companies registered in Singapore, yet their offices and employees are in other countries, can completely avoid taxation since they are exempt.