Binance Holdings Ltd. must stop offering services regulated in Singapore after a potential breach of local payment rules, adding to a mounting list of jurisdictions scrutinizing the world’s largest cryptocurrency exchange.
Binance may be in breach of the Payments Services Act for providing payment services to, and soliciting business from Singapore residents without an appropriate license, the Monetary Authority of Singapore said Thursday, in response to questions from Bloomberg.
As Binance didn’t apply for a license under local law, the MAS has added Binance.com to the investor alert list, which warns consumers that Binance isn’t regulated or licensed to provide any payment services locally.
The Singapore regulator’s warning marks the latest blow for Binance, which has grown quickly since its 2017 debut and doesn’t have a global headquarters. While Binance has also drawn scrutiny from regulators in the U.S., the U.K., Thailand, Malaysia and Japan, crypto bulls say tougher frameworks are a sign of market maturity offering more protection for investors that could lure more money to digital assets.
Its Singapore operations are conducted by 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 said in an emailed reply to Bloomberg.
Binance Asia Services, which operates Binance.sg, has submitted a license application, and is currently exempted from holding a license for the provision of digital payment token services, MAS said. The application remains under review, and subject to it demonstrating that it is able to meet requirements under the Payment Services Act, MAS said.
MAS has been engaging BAS and expects the firm to immediately begin an orderly suspension of its facilitation of transfers of digital payment token assets between BAS and Binance, according to the regulator. The Singapore unit of Binance will inform its customers of the appropriate arrangements as soon as practicable, according to MAS.
Binance CEO Zhao Changpeng, a Canadian citizen, resides in Singapore and is the majority shareholder of Binance Asia Services, according to filings to the Accounting and Corporate Regulatory Authority. Temasek Holdings Pte.’s Vertex Venture Holdings Ltd are an investor in Binance Asia.