Binance withdraws Abu Dhabi bid amid global licensing reevaluation

MAS Offers Guidelines for Banks Handling Crypto-Related ClientsThe Monetary Authority of Singapore (MAS) has released a comprehensive set of guidelines to assist banks in managing clients who are involved in digital assets, such as cryptocurrency exchanges or individuals whose wealth is derived from cryptocurrencies.Photo by Meriç Dağlı on UnsplashIndustry working groupAccording to a report in local media source, The Straits Times, these non-mandatory guidelines, developed by an industry working group, aim to provide best practices for financial institutions to address concerns related to money laundering, terrorism financing, and sanctions risks associated with cryptocurrencies.The working group suggests that enhanced due diligence may be necessary for firms closely connected to facilitating crypto transactions. For instance, conducting site visits or walk-throughs of a client’s anti-money laundering and anti-terrorism financing processes and controls could be required.During the onboarding process, banks should request information documenting the customer’s crypto exposure and the intended usage of the account. Additionally, banks are advised to establish the source of the client’s funds or wealth.To evaluate the regulatory status of a merchant customer’s crypto-related counterparties, especially if they contribute significantly to the merchant’s transactions, banks should conduct thorough assessments.The working group also highlights the use of blockchain screening tools to review the on-chain activity of digital token payment service providers. Regular screening of new and existing wallet addresses owned or controlled by these providers against the sanctions list and designated wallets is also recommended.Comprehensive guidelinesLoretta Yuen, Head of Legal and Compliance at Oversea-Chinese Banking Corp (OCBC), a Singapore-headquartered bank, describes the guidelines as one of the most comprehensive in the world, providing insights into banks’ management of crypto-related money laundering, terrorism financing, and sanctions risks.She believes the guidelines will raise awareness among prospective customers regarding the key risk considerations banks prioritize and enable customers to proactively fulfill banks’ customer due diligence requirements during the onboarding process.Evy Theunis, DBS Bank’s Head of Digital Assets, views the guidelines as a codification of best practices across the industry, aligning with the bank’s existing protocols. United Overseas Bank (UOB) also acknowledges the benefits of the best practice paper, particularly given the diverse range of digital assets with varying levels of risk.Eight participating banksThe working group responsible for developing these guidelines includes representatives from eight banks, MAS, the Commercial Affairs Department, and Big Four audit firm Ernst & Young. Formed in August 2022 under the anti-money laundering and countering the financing of terrorism industry partnership (ACIP), the group aims to identify, assess, and mitigate money laundering and terrorism financing risks in Singapore through a collaborative private-public partnership involving the financial sector, regulators, law enforcement agencies, and other government entities.Singapore is vying to establish itself as a hub for digital asset business in Asia, alongside other centers such as Hong Kong. The Chinese autonomous territory has been making greater progress over the course of the past year.However, a report in The Wall Street Journal on Monday suggests that banking remains a difficulty for crypto businesses in Hong Kong. Hong Kong’s difficulty may be Singapore’s opportunity, given the work that this working group has carried out in smoothing the way for the banking of digital asset-related businesses.

Zodia Custody Expands Its Custodial Services to SingaporeDeveloping crypto business hub Singapore has added another player to its list of local crypto sector participants with the arrival of digital asset custodial services provider Zodia Custody.The London-headquartered institution-first digital asset custodian is setting up shop in Singapore. Zodia Custody is backed by Japan’s SBI Holdings, alongside prominent financial services firms Standard Chartered and Northern Trust. Through this move, outlined in an article published by CNBC on Monday, it’s now targeting financial institutions in Singapore for the digital asset custody services it offers to that cohort.Photo by Kin Pastor on PexelsWell-timed expansionIt’s understood that Zodia has ambitious growth plans relative to the Asia-Pacific (APAC) region. In May, the firm entered the Middle Eastern market, establishing a presence in Dubai. The firm’s timing is prescient relative to Singapore, as the custodian is responding via its Singapore expansion to an increasing demand coming from institutions seeking robust digital asset custodianship services.The expansion also coincides with the Monetary Authority of Singapore’s (MAS) recent efforts to foster a well-defined digital asset ecosystem. Of late, the MAS introduced a comprehensive framework that encompasses the use of digital currencies, including central bank digital currencies and stablecoins. Moreover, MAS has proposed draft legislation that outlines the safeguarding of digital assets, signaling the pivotal role custodial services are set to play in Singapore’s evolving digital asset landscape.The firm has established a specific local entity, Zodia Custody (Singapore) Pvt. Limited, appointing Kai Kano, the former Managing Director of rival digital assets custodian Bitgo, as the new company’s CEO.Speaking on the subject of the firm’s Singapore market entry, Julian Sawyer, the CEO of Zodia Custody, stated:“Singapore is no stranger to digital assets, having long been a hub for financial technology innovation. But even in a mature market, challenges remain. Having been created by Standard Chartered Ventures, we have a deep understanding of institutional needs and requirements not just to enter the space but thrive within it. As we engage with the local ecosystem, we’ll be providing market participants with cutting-edge technology, bank-level compliance, and governance to accelerate their digital asset adoption journeys.”Strategic partnershipsIn the past year, Zodia Custody has established strategic partnerships with industry leaders such as LMAX Digital, Hidden Road, BlockFills, and Blockdaemon. These collaborations are driven by Zodia’s market-leading Interchange offering, which equips institutions with enhanced risk management, secure custody, and solvency protection.The expansion into Singapore marks the latest milestone in Zodia Custody’s global growth strategy. Over the past year, the custodian has expanded into Japan through a joint venture with SBI Digital Asset Holdings and into Luxembourg, where it operates as a registered virtual asset service provider (VASP). This move into Singapore follows a successful US$36 million Series A fundraising round.Meanwhile, its sister company Zodia Markets, which is totally segregated from Zodia Custody, made the news in crypto circles earlier this month when it achieved in-principle approval in Abu Dhabi for a broker-dealer license.

Bgin Blockchain Limited, a crypto mining equipment manufacturer headquartered in Singapore, filed documentation last Friday with the Securities and Exchange Commission (SEC) with a view towards launching an initial public offering (IPO) in the U.S. The Feb. 21 filing, a Form F-1 registration statement, outlines that the company wishes to go forward with the IPO after the effective date of the filing has been established. Bgin identified itself as an “emerging growth company.”  The registration statement was filed on behalf of Bgin by Hunter Taubman Fischer & Li LLC, in conjunction with the underwriters represented by Robinson & Cole LLP. It proposes to offer the U.S. investing public 59.54 million Class A ordinary shares and 15.69 million Class B shares. As part of its plan, Class A shares would be listed on the Nasdaq stock exchange using “BGIN” as the ticker symbol.Photo by Leslie Lopez Holder on Unsplash$50 million raiseIn a statement published on Renaissance Capital's website, the independent investment bank outlined that Bgin is seeking to raise $50 million in capital through the IPO.  It’s understood that funds raised by way of the IPO will be utilized to ramp up research and development efforts. The bookrunners, responsible for managing the IPO, are Chardan Capital Markets and The Benchmark Company. As yet, no information has been provided with regard to how Bgin will price its share offering. Renaissance described Bgin as a digital asset technology company “with proprietary cryptocurrency mining technologies and a strategic focus on alternative cryptocurrencies.”  The company, founded in 2019, focuses on the design, manufacture and distribution of mining equipment relative to Kaspa (KAS), Alephium (ALPH) and Radiant (RXD) blockchain networks. Bgin supplies 8nm and 12nm ASIC chips dedicated to these alternative blockchain networks, which all depend on the use of a proof-of-work (PoW) consensus mechanism. Additionally, Bgin mines cryptocurrency itself while providing a hosting service for crypto mining, with facilities in the U.S. and Hong Kong. It hosts 4,020 mining rigs for customers, with 3,330 of these located within facilities in Iowa and Nebraska.  Across various subsidiaries Bgin manages 33,862 active mining rigs in the U.S. within its own mining operations. And additional 12,000 non-operational rigs are currently in storage facilities in the U.S. and Hong Kong. Over a 12-month period ending on June 30, 2024, the company recorded revenues of $392 million. In 2023, the firm recorded sales of 68,000 mining rigs. In H1 2024, the company sold over 47,000 mining machines. The filing disclosed that the company’s Hong Kong subsidiary was responsible for considerable crypto mining facilities in mainland China prior to China deeming the activity to be illegal in 2021. Providing full disclosure in the lead-up to its IPO, the firm warned that it continued to operate crypto mining facilities in China for a number of months in violation of that law. It identifies this item as a risk factor as potentially, the firm could be penalized and fined.