Singapore Regulator Explains Action Against Binance vs FTX

• MAS has taken any action against Binance rather than FTX.
• After Binance shut down in Singapore all users switched to FTX.

The Monetary Authority of Singapore (MAS), the regulator in charge of the crypto sector, has defended the action it took against Binance, rather than the bankrupt crypto platform FTX. The central bank also warned that cryptocurrencies are extremely volatile, with many losing all of their value. And, on Nov 21, the country’s central bank issued a press release that addressed some of the problems and errors that arose in the context of the FTX disaster.

MAS versus Crypto Exchanges

MAS has revealed that their first error is that it is possible to save local users from those who are connected to FTX. It is not possible because FTX is not licensed by MAS and operates through offshores.

The MAS has taken any action against Binance rather than FTX. They initially appeared on the central bank’s Investor Alert List (IAL), whereas the others did not. The regulator said that both firms are licensed; the difference between the two is that FTX pursued consumers in Singapore, whereas FTX did not. Between January and August 2021, MAS received a few complaints about Binance.

Following MAS’ referral, the Commercial Affairs Department launched an investigation into Binance for possible Payment Services Act breaches (PS Act). There was no reason to place FTX on the IAL because there was no proof of a violation of the PS Act. And Binance warned a few months earlier that it would shut down the services, and after Binance shut down, all users switched to FTX.

MAS warned that 

“Crypto exchanges can and do fail. Even if a crypto exchange is licensed in Singapore, it will be regulated to address money-laundering threats, not to protect investors.”

Following FTX’s demise, Singapore’s Temasek wiped down its $275 million investment in the crypto company. Singapore has attempted to reduce risks for retail crypto investors by implementing strict regulations.