Singapore’s cryptocurrency market Significant increase in cryptocurrency paymentsIn the second quarter of 2024, Merchant Services will receive approximately $1 billion worth of cryptocurrency.
The surge reflects the increasing adoption of digital assets as a payment method across industries, including services offered by home-grown startups such as dtcpay and super-app Grab.
The two companies have integrated cryptocurrencies such as Bitcoin, Ether, Singapore’s XSGD stablecoin and USDT into their payment options, allowing customers to use these assets for everyday transactions such as depositing funds into their e-wallets.
A key part of this growth has been the rise of XSGD, a Singapore dollar-backed stablecoin issued by StraitsX.
XSGD has become increasingly popular, especially among retail users, with over 75% of transfers being in amounts below $1 million USD.
About 25% of these transfers were for less than US$10,000, indicating robust adoption in retail.
In contrast, stablecoins pegged to the US dollar, such as USDT, are primarily seen in large amounts transferred, reflecting their greater institutional use.
These developments are supported by important regulatory developments.
In August 2023, the Monetary Authority of Singapore (MAS) Stablecoin regulatory framework finalizedIt provides clear guidelines for publishers.
For example, StraitsX Secured Two MAS licenses to issue stablecoins and facilitate cryptocurrency payments.
Meanwhile, US-based stablecoin issuer Paxos also Earned MAS approves stablecoin issuance in Singapore.
The growing acceptance of stablecoins and other cryptocurrencies will be further supported by the MAS’s cryptocurrency custody and licensing requirements, which come into effect in April 2024.
As interest in stablecoins grows, Singapore’s largest bank, DBS, Explore Listing stablecoins on digital exchanges.
The bank saw its crypto trading volume triple in early 2024 due to increased demand from institutional investors.
These regulatory measures, coupled with increased adoption and scrutiny of cryptocurrency merchants by major financial institutions such as DBS, have established Singapore as a key hub for digital assets.
Featured Image Credit: Free Pick
