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Singapore is one of the most welcoming places for cryptocurrency businesses. The national regulator regularly updates the rules and offers clear guidelines on licensing cryptocurrency exchanges. We, at Alparanjo, are available to assist with registering a cryptocurrency company and getting a cryptocurrency license in Singapore.

As a parliamentary republic and a leading financial hub in Southeast Asia, Singapore is known for its strong economy and business-friendly environment, which attracts companies from various regulated industries. Many businesses, particularly in finance, cryptocurrency, and payments, choose to operate in Singapore. Singapore holds a prestigious position as an international financial center, recognized for its low tax policies for both local and international companies, as well as its practical approach to regulating fees.

Currently, Singapore is one of the few places where cryptocurrency exchanges are regulated by law. Between 2014 and 2018, the national regulator (MAS) provided guidance on cryptocurrencies, ICOs, and licensing for cryptocurrency exchanges. In 2019, the Payment Services Act came into effect, requiring companies that exchange cryptocurrencies for either other cryptocurrencies or fiat money to obtain either a Small Payment Institution or Major Payment Institution license.

Cryptocurrency exchanges act as intermediaries in the trading of virtual currencies and fiat money. It is important to note that if a cryptocurrency exchange starts offering services for buying and selling tokens that are considered securities, it must obtain a full stock exchange license.

Advantages of obtaining a cryptocurrency
licensein Singapore

Getting a cryptocurrency license in Singapore has many benefits:

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1

Good reputation

Singapore is well-known and respected worldwide as a major financial center. Having a license from Singapore makes your cryptocurrency business look more trustworthy to customers and partners.

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2

Clear rules and transparency

Singapore makes sure that cryptocurrency businesses follow the law and are transparent. The national regulator provides clear guidelines so businesses can meet the necessary rules.

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3

Business-friendly environment

Singapore has a strong economy, good infrastructure, and supports new technologies like blockchain and cryptocurrency. This makes it a great place to run a cryptocurrency business.

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4

Tax advantages

There’s a low income tax, no VAT on cryptocurrencies, and no tax on profits made outside Singapore.

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Access to global markets

Being an international financial hub, Singapore gives businesses the opportunity to reach global markets. It also works closely with other countries and regulators, creating more chances for partnerships and expansion.

However, getting a cryptocurrency license in Singapore means you must meet certain standards,
go through registration, and pass a compliance check.

Find more information about the
Singapore Crypto license

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Requirements for obtaining a Crypto
License in Singapore

Getting a cryptocurrency license in Singapore has many benefits:

  • Reputation and Trust: Singapore is a well-known financial hub. Having a license there boosts your company's reputation and helps build trust with customers and partners.
  • Regulation and Clarity: Singapore regulates cryptocurrency companies to ensure legal and transparent transactions. The national regulator provides clear rules to help you follow the law.
  • Supportive Business Environment: With a stable economy, good infrastructure, and support for technology and innovation, Singapore is a great place for cryptocurrency businesses.
  • Tax Benefits: There’s low income tax, no VAT on cryptocurrencies, and no tax on profits made abroad.
  • Access to Global Markets: As an international financial center, Singapore connects you to global markets. The country works closely with other nations on cryptocurrency and fintech, offering more chances to grow your business and form partnerships.

However, getting a cryptocurrency license requires meeting certain standards and going through a registration and compliance process. To obtain a license, a company must:

  • Be registered as a legal entity in Singapore.
  • Have a physical office in Singapore.
  • Have at least one director who lives in Singapore.
  • Set up a risk management system specifically for cryptocurrency.
  • Create and enforce clear rules for listing tokens on exchanges.
  • Maintain a record of all transactions.
  • Notify the regulator of any changes in exchange operations.
  • Follow anti-money laundering laws and privacy rules.

The regulator also has specific requirements for company staff, which must include:

  • A chairman.
  • A CEO.
  • Members of the board of directors.

The board must have:

  • An audit committee.
  • A nominating committee.
  • A conflict resolution committee and other similar committees.

Executives must have high ethical standards, a good reputation, and relevant education and experience in finance.

The Process and Timeline for Obtaining a Crypto
License in Singapore

Getting a cryptocurrency license in Singapore involves a few steps:

  • Set Up a Company: First, you need to start a private limited company in Singapore and prepare an application for a cryptocurrency license. This means collecting all necessary documents, creating a business plan, explaining your business model, and detailing your risk management system. The time it takes to prepare this application can vary based on how complex your business is and how quickly you can gather the needed documents.

  • Submit the Application: Next, you submit your application to the Monetary Authority of Singapore (MAS), which is the regulatory body. They will review your application, which can take anywhere from a few weeks to several months. During this time, MAS checks the documents you provided and might ask for more information or clarifications.

  • Screening and Assessment: While they review your application, MAS will make sure your company meets the required standards for cryptocurrency operators in Singapore. This includes checking your financial performance, risk management system, and ensuring all documents are correct and comply with the law.

  • Decision and License Issuance: After reviewing everything, MAS will decide whether to approve or deny your license application. If approved, you will receive your cryptocurrency license.

The time needed to get a license can vary based on how complex your application is and how complete your documents are. On average, it takes about 6 to 8 months to get a cryptocurrency license in Singapore.

If you're new to the cryptocurrency industry, the laws in Singapore can seem complicated. However, the professional advisors at Alparanjo can help you understand everything about running your business in this area. They are ready to answer your questions and provide support.

Find more information about the
Singapore Crypto license

Send Request

Taxation of Crypto Activities in Singapore

Right now, Singapore doesn’t have a special tax category for cryptocurrencies. Tax rules depend on the company’s activities. If a company mainly trades cryptocurrencies, the profits from those trades may be taxed as corporate income. The Income Tax Act sets a low tax rate of 17% on net income. Also, starting January 1, 2020, the Internal Revenue Authority of Singapore (IRAS) decided that the Goods and Services Tax (GST) won’t apply to cryptocurrencies. However, if a company provides services like exchanging, storing, or processing payments for cryptocurrencies, those services may be subject to VAT.

Crypto companies in Singapore may get tax exemptions if they meet certain criteria. To qualify, a company must be a tax resident in Singapore and have no more than 20 shareholders at the end of the assessment year. At least one shareholder must own at least 10% of the company.

Eligible companies can receive a 75% tax exemption on income up to $100,000 for the first assessment year. They can also get a 50% exemption on the next $100,000 of income for following assessment years.

Keep in mind that tax exemption amounts and conditions can change, so it’s best to check with official sources or tax advisors for the latest information. The IRAS published an electronic tax guide in 2022 that has more current details on digital token taxation in Singapore.

Additionally, there is no capital gains tax in Singapore, so companies that buy digital tokens for long-term investment won’t pay tax on gains when they sell them later. However, if cryptocurrencies are treated as investment or personal assets, the tax situation may differ based on individual circumstances. IRAS considers factors like the purpose of the investment, how often transactions happen, and how long tokens are held to decide if profits from sales are taxable or not.

Tax rules for cryptocurrency in Singapore can vary based on individual cases. It’s a good idea to consult with professional tax advisors, like those at Alparanjo, who specialize in cryptocurrency taxes in Singapore to get accurate advice tailored to your situation.

Any Questions

Frequently Asked Questions

The cost for a crypto license in Singapore can change based on the type of license and services offered. The Monetary Authority of Singapore (MAS) has different fees for different licenses. The application fee ranges from S$1,000 to S$1,500.
You only need a license if you run a cryptocurrency exchange that trades tokens under securities laws. If you are a service provider that offers only digital payment tokens from a central bank or financial institution for a specific purpose, you don’t need a license.
Yes, cryptocurrency is regulated in Singapore. The Monetary Authority of Singapore (MAS) has created rules to manage crypto activities and ensure the financial system remains safe and stable.
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