MAS Clarifies Singaporean FTX Users Not Protected, Reiterates Crypto Risk
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MAS Clarifies Singaporean FTX Users Not Protected, Reiterates Crypto Risk

MAS said it has not required FTX to move users to its Singapore-based entity Quoine.
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Singapore’s central bank says it has not required the embattled crypto exchange FTX to move Singapore users to Quoine – FTX’s Singapore-based subsidiary – because the two operate as separate individual legal entities. Users in Singapore can choose between dealing with “either FTX.com or Quoine,” added the central bank.

MAS Has Not Asked FTX to Move Users to its Singapore-based Entity

The Monetary Authority of Singapore (MAS), the central bank of the city-state, said funds of Singapore-based investors in the collapsed FTX are not held in its local subsidiary Quoine because the two crypto exchanges operate as separate legal entities, according to Straitstimes. That said, Singapore authorities have not required FTX to move its users to Quoine, added MAS.

“Singapore users have the choice to deal with either FTX.com or Quoine. MAS has not required FTX.com to migrate Singapore users to Quoine.”

– the Monetary Authority of Singapore said.

The central bank also said it is currently reviewing the license application from Quoine. The subsidiary will remain exempt from licensing until the review is completed, MAS noted. Additionally, FTX does not operate in Singapore and the crypto exchange is neither licensed nor excepted from being licensed in the city-state.

“It is not possible, however, to prevent Singapore users from directly accessing overseas service providers. FTX.com was therefore able to onboard Singapore users. MAS has consistently reminded the public of the risks of dealing with unlicensed entities.”

– the MAS added.

Quoine Corporation is an operating subsidiary of the Japanese crypto exchange Liquid, which was acquired by FTX in February 2022. While Quoine Corp. is based in Japan, the exchange also has an operating unit in Singapore.

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MAS Voices Concerns About Lack of Crypto Regulations in Singapore

MAS also said it has been continually alerting the public about the risks of crypto trading in Singapore. While crypto exchanges that obtained licenses in Singapore are regulated for money laundering and terrorism financing, they are not subject to risk-based capital or liquidity regulations and are also not required to protect user funds from insolvency risks, added MAS.

The central bank’s comments come just a few days after FTX, formerly one of the biggest crypto exchanges in the world, went bankrupt, sending shockwaves through the crypto space. The company saw a liquidity crunch last week, partly because its rival Binance said it is selling all of its FTX token holdings due to “recent revelations” involving FTX’s sister firm Alameda Research.

Binance then offered to buy FTX in a rescue move but walked away from that deal just a day later. FTX’s founder and CEO Sam Bankman-Fried said Binance probably never planned to go through with the acquisition and tried to raise new funds, but the FTX crypto exchange filed for bankruptcy last Friday.

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