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Bitcoin in Singapore: Live SGD Price, Best Exchanges, Taxes, and History
Singapore is one of the financial centers of the world, so it’s to be expected that the city is making great strides in accommodating the fast-moving cryptocurrency industry. Although Bitcoin is not considered legal tender in the country, they still nonetheless have relatively lax regulations on the industry. Exchanges do not need to register to operate and the Monetary Authority of Singapore (MAS) does not believe it needs to regulate the industry just yet.
Singapore has become so popular within the blockchain industry due to its friendly legal atmosphere that Consensys, the largest blockchain conference in the world, was recently held here in 2019. Regulators have been open about their intention to accommodate the industry which is why it is one of the best places in the world to be a cryptocurrency investor.
Is Bitcoin Legal in Singapore?
In 2013, the Monetary Authority of Singapore took a stance which argued that any exchange of Bitcoins is a “commercial decision in which MAS does not intervene.” This has been the assume legal framework for some time, with certain tax guidelines to better inform investors. However, the law was recently updated this year in the Payment Services Act. In April 2019, the MAS referred to Bitcoin as a ‘digital payment token.’
Overall, Singapore has taken a hands-off approach to the cryptocurrency legal question. This means that many blockchain-related companies have been moving to the rich city-state in droves which has made the country something of a hub for the industry.
How to Buy and Sell Bitcoin in Singapore
Buying and selling Bitcoin in Singapore is relatively easy due to the hands-off approach from the state. So, investors and traders can rest easy knowing that no legal hiccups will arise from engaging in Bitcoin-related transactions and trading. Here are some of the top exchanges to trading Bitcoin in Singapore.
Top Bitcoin Exchanges in Singapore
Singapore boasts a few of its own cryptocurrency exchanges and other international platforms also boast a presence in the country.
CoinHako is a Bitcoin broker based in Singapore and backed by US investors. As such, they accept bank transfers from many different nations and allow one to buy Bitcoin in as little as 10 minutes. Fees are relatively low and the exchange is quite trusted. Bear in mind, however, you will have to verify your identity to trade here. Its international backing means that CoinHako is one of the rare Singaporean exchanges which boasts funding from outside the country.
FYB-SG is the first-ever Bitcoin exchange to be established in Singapore. It boasts low fees at only 0.6% per trade and instant deposits/withdrawals of SGD. Relatively easy to use, FYB-SG has been in the cryptocurrency trading business for a long time and is a safe bet for those looking to purchase some Bitcoin. It’s been a staple in the cryptocurrency industry in the country for years.
Coinbase, believe it or not, provides its services in Singapore as well. Traders can deposit their fiat currency into the exchange and enjoy all the perks that traders in the United States, UK, and elsewhere enjoy. If you prefer to entrust your funds with Coinbase over CoinHake or FYB-SG, then the leading exchange should be your Bitcoin trading destination of choice.
This year, Binance opened up its very own Singaporean branch which offers direct fiat-to-crypto currency trading. The effort is a joint collaboration with a cryptocurrency startup named Xfers. Many of the features have yet to be rolled out on the exchange, but there are currently the BTC/SGD trading pair which has significant trading volume.
Of course, if Singaporeans prefer, they can also use Binance’s decentralized exchange. However, it does not support fiat nor does it have any Bitcoin trading pairs due to it all being on Binance’s own blockchain.
If you are looking to buy and sell Bitcoin peer-to-peer directly, then you might prefer LocalBitcoins. Currently, there are many buyers and sellers based in Singapore who are open to making trades either in-person or online. Just be wary of scams. Overall, OTC trading is quite popular in Singapore due to the low regulatory environment. Broker-dealers generally negotiate large purchases of BTC and many of the larger trades are therefore done OTC and not a secondary market.
Additionally, you can purchase Bitcoin using a Bitcoin ATM. The city currently boasts a handful of locations. As of now, there are 9 Bitcoin ATMs in Singapore. This number is expected to grow though as the country becomes more and more exposed to everyday cryptocurrency payments.
Singapore’s Tax Rules on Bitcoin Profits
Singapore is one of those unique countries which, if you’re a long-term holder, you have to pay 0 in taxes for holding Bitcoin. If you are a business, you have to pay a tax on the profits as if it were income. However, since there is no capital gains tax in Singapore, you are free to invest and hold Bitcoin without worrying about owing the government anything.
Singapore is something of a tax haven due to it having no capital gains tax, but most investors don’t know this also applies to Bitcoin. There is no other nation that both recognizes Bitcoin as legal and places no capital gains tax on it whatsoever.
Where to Spend Bitcoin in Singapore
There are various Singaporean merchants which accept Bitcoin and other cryptocurrencies. However, the number of them is still small. For example, there is Shiok Kitchen which serves authentic Singaporean food which accepts Bitcoin. Oyster Bar, a European seafood bar in the country, also accepts Bitcoin. Other eateries, clothing stores, and brick-and-mortar shops have become open to BTC-based payments and have been integrating it more and more with their businesses. Generally, foreign stores in Singapore are far more likely to accept BTC than local ones yet. However, things are quickly changing.
Of course, if you find yourself not wanting to spend Bitcoin as a physical location, there are many online vendors that also accept BTC. Just make sure they deliver to Singapore, of course, before making any purchases.
History of Bitcoin in Singapore
In December 2013, the Monetary Authority of Singapore (MAS), the country’s central bank and financial regulator, suggested in an email to Coin of Sale, a service for brick-and-mortar merchants to accept Bitcoins, that it would not regulate the acceptance of Bitcoin by businesses.
MAS called participation in such transactions a commercial decision in which the Authority should not intervene. Then just after a month, the Inland Revenue Authority of Singapore (IRAS) became one of the first regulatory bodies in the world to make a determination on how digital currencies should be taxed.
The IRAS ruling stated that individuals who made money through Bitcoin investments, would be taxed at the current zero percent capital gains tax rate.
That meant all the digital currency transactions involving real money or services, such as buying and selling bitcoins with dollars or paying for services with bitcoins, would qualify for GST (Goods & Services Tax).
“Businesses that choose to accept virtual currencies such as Bitcoins for their remuneration or revenue are subject to normal income tax rules,” states the IRAS. “They will be taxed on the income derived from or received in Singapore. Tax deductions will be allowed, where permissible, under our tax laws.”
Since IRAS applies no capital gains tax in Singapore, those businesses that buy the digital currencies with long-term horizons will be exempt from paying taxes. The authority takes into consideration the purpose, the frequency of transactions, and the holding period when determining if the gains should be taxed.
While other fintech hubs are still struggling to come up with proper regulations, Singapore managed to achieve that feat back in March 2014 – the country took an official regulatory stance on digital currencies for the other countries to follow.
MAS announced its plans to regulate digital currency businesses operating in Singapore in order to keep away any potential risk of money laundering schemes or terrorism financing that leveraged the anonymity of digital currencies.
It also indicated that intermediaries who bought, sold or facilitated the exchange of digital currencies for other currencies would be required to verify customers’ identities as well as to report any suspicious transactions to the Suspicious Transaction Reporting Office. This is now a common practice in other countries.
However, MAS did not consider Bitcoin and other digital currencies as securities or legal tender and hence Bitcoin avoided regulation under Singapore’s Securities and Futures Act or Financial Advisers Act.
In August 2016, Singapore central bank proposed new rules for Bitcoin startups. The proposed framework require applicable companies to obtain a license from the Monetary Authority of Singapore, and divides payment activities into several categories.
Needless to say, this was and still is a great news for businesses accepting Bitcoin in Singapore. They have officially formed a trade association, the Association of Cryptocurrency Enterprises and Startups, Singapore (ACCESS). It aims to promote Singapore as one of the premier bitcoin business locales in through education and dialogue with the government.
Regulations are necessary to integrate Bitcoin into the traditional financial system and help manage the risks involved in cryptocurrency transactions. There is no doubt Singapore has done a fantastic job so far.