Paxos Gets Monetary Authority of Singapore Approval

Key Insights:

• Crypto trading and custody platform Paxos gets MAS approval.
• Paxos becomes the first platform to receive licenses in New York and Singapore.
• The latest approval further cements Singapore’s status as Asia’s crypto hub.

Launched in 2012, Paxos is a trading and custody services provider. As a crypto exchange, Paxos also supports Binance USD (BUSD) and Pax Dollar (USDP) and also offers users PAX Gold (PAXG).

Each PAXG token is backed by one fine troy ounce of a 400 Oz London Gold Delivery gold bar. PAXG holders own the underlying physical gold held in custody by Paxos Trust Company.

Paxos also builds blockchain solutions for institutional customers. These include Bank of America, Credit Suisse, Interactive Brokers, PayPal, and Société Generale.

Paxos has had a presence in Singapore since 2012, while also regulated by the New York Department of Finance Services.

Monetary Authority of Singapore Gives Paxos Coveted License

On Thursday, Paxos announced in-principal approval for a Major Payments Institution license from the MAS.

According to the announcement, Paxos became the first blockchain infrastructure platform to secure regulatory oversight in the financial hubs of New York and Singapore.

As a result of the MAS license, Paxos can offer its digital asset and blockchain products and services to Singaporean domiciled customers.

We're excited to receive in-principle approval for a Major Payments Institution license from the Monetary Authority of Singapore! @MAS_sg Learn what that means here: https://t.co/cA8oPdTIh0

— Paxos (@PaxosGlobal) March 10, 2022

 

Co-Founder and CEO, Paxos Asia said,

“We’re excited to have MAS as our regulator, and with their oversight, we’ll be able to safely accelerate consumer adoption of digital assets globally by powering regulated solutions for the world’s biggest enterprises.”

MAS sets a High Bar for Crypto-Related Firms

The MAS does not readily hand out licenses, as Binance discovered in 2021. Last year, Binance reportedly withdrew its Singapore license application for failing to meet MAS AML and KYC requirements.

A small number of other crypto-related shops have been more fortunate, however. In October, DBS Vickers obtained a license to offer digital payment token services.

At the time, the Australian crypto exchange Independent Reserve was reportedly the only foreign entity to hold a Singapore license to allow digital payment token services.

Before this week, only FOMO Pay and TripleA had obtained digital payment token services licenses alongside DBS Vickers and Independent Reserve.

This week, Swiss crypto bank Sygnum received in-principal approval to expand Singapore Capital Market Services (CMS) license. The Swiss crypto bank had previously held a Singapore Capital Markets Services (CMS) license for asset management since 2019.

The in-principal approval will allow Sygnum Bank to provide corporate finance advisory services, deal with capital market products, and provide custodial services.

Paxos and Sygnum Approvals a Boost for Hub Aspirations

Singapore and the MAS have been particularly active in the digital asset space. The Republic’s status as a global digital asset hub continues to evolve despite a high bar for platforms to meet.

Singapore’s high bar is evident in the number of applications the MAS has rejected. According to media reports, the MAS turned down 103 of 176 by December 2021.

In 2021, Binance withdrew its Singapore application for reportedly failing to meet MAS KYC and AML requirements. Since then, the MAS has also banned crypto exchange advertising in public.

This week’s news could be a shift in attitudes towards crypto-related firms. News of Singapore’s sovereign wealth fund Temasek making strategic investments into the space could support such a view.

Temasek reportedly led a fresh fundraising round for the Australian NFT startup Immutable. A $200m funding round took the value of Immutable to $2.5bn, with investors including Tencent Holdings, Mirae Asset, and Declaration Partners, among others.

In February, Temasek had led a $200m round for Amber Group, a global digital assets platform.