SINGAPORE Law and Practice Contributed by: Kenneth Pereire and Lin YingXin, KGP Legal LLC
Key differences include: • cryptocurrencies are primarily governed by the PSA, focusing on payment services and AML/CFT compliance; and • security tokens are treated as securities and regu - lated under the SFA, with stricter investor protec - tion and disclosure requirements. 6.3 Impact of the Emergence of Cryptocurrency Exchanges Regulatory Response to Cryptocurrency Exchanges The emergence of cryptocurrency exchanges, both centralised and decentralised, has prompted Singapo - rean regulators to adopt comprehensive frameworks, including the extension of AML/CFT regulations. Cryptocurrency exchanges may be regulated under the PSA, which requires them to obtain a licence if they facilitate the exchange of digital payment tokens. These exchanges must comply with stringent require - ments, including filling suspicious transaction reports with the Suspicious Transaction Reporting Office and implementing strict CDD procedures. This regulatory approach reflects Singapore’s commitment to inno - vation while combating financial crimes, marking a significant advancement in response to the growing cryptocurrency market. Balancing Innovation and Security Singapore aims to balance promoting innovation in the cryptocurrency sector with maintaining the integrity and security of the financial system. The PSA under - scores the importance of transparency, accountability and regulatory co-operation, which strengthens the resilience of Singapore’s cryptocurrency ecosystem. This regulatory framework applies equally to cen - tralised exchanges, which operate through a central authority, and decentralised exchanges, where trading occurs directly between users without an intermedi - ary. By enforcing these robust requirements, Singa - pore preserves its position as a leading global finan - cial hub while addressing the risks associated with rapidly evolving digital assets and platforms. 6.4 Listing Standards Listing standards in Singapore are overseen by the SGX and are divided into Mainboard and Catalist,
each with distinct requirements for different types of companies. Mainboard For Mainboard, companies must meet stricter finan - cial thresholds and governance standards. The key requirements include the following. • Profitability – a company must demonstrate a mini - mum consolidated pre-tax profit of at least SGD30 million for the latest financial year with an operating track record of at least three years. • Market capitalisation – alternatively, a company can be profitable in the latest financial year and have a market capitalisation of at least SGD150 million, also with at least three years of operating track record. • Revenue – if not meeting profitability thresholds, the company must have operating revenue in the latest financial year and a market capitalisation of at least SGD300 million. Catalist For Catalist, the standards are more flexible, focusing primarily on corporate governance without imposing strict quantitative thresholds. However, companies must still adhere to governance standards that ensure transparency and accountability. Global Financial Industry Globally, financial markets broadly agree on key listing standards that align with the regulatory frameworks of exchanges around the world. These standards typi - cally include the following. • Financial performance – demonstrating profitability and strong financial health. • Corporate governance – adhering to strong gov - ernance frameworks that promote accountability. • Listing fees – ensuring that the costs associated with listing align with the company’s scale and market standing. • Liquidity of shares – companies must have suffi - cient share liquidity to ensure ease of trading. • Size of firm – the size is generally determined through income levels and market capitalisation, ensuring that only companies of sufficient scale can list on prominent exchanges.
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