Singapore has long been recognised as a leading fintech hub, and is home to thousands of fintech startups and scaleups, alongside global investment banks, wealth management companies and VC firms. 

In fact, in recent years Singapore has been hot on the tails of London and New York for the title of “fintech capital of the world”.

With the meteoric growth of the cryptocurrency sector in recent years, Singapore’s fintech expertise has arguably made it the leading cryptocurrency hub in Asia too. 

In fact, a growing number of crypto experts are hailing Singapore as one of the best (if not the best) place to launch a crypto startup - not just in Asia, but in the world. 

Here’s why.

Regulatory Environment

One of Singapore's biggest appeals for crypto startups is its clear and highly supportive regulatory framework for cryptocurrencies. 

The Monetary Authority of Singapore (MAS) has been proactive in providing guidelines that foster innovation while ensuring consumer protection. 

The Payment Services Act, which came into force in 2020, offers a comprehensive regulatory structure that addresses various aspects of cryptocurrency operations, including anti-money laundering (AML) and counter-terrorism financing (CTF) measures. 

This clear and supportive regulatory environment became even more attractive to cryptocurrency businesses after China banned crypto in 2021, which encouraged many Asian cryptocurrency businesses to move their operations to Singapore. 

Financial Infrastructure

Singapore's well-established financial infrastructure is another critical factor attracting crypto startups. As a leading financial hub in Asia, Singapore offers access to a wide array of financial services, ranging from banking to venture capital. 

The presence of numerous international banks, investment firms, and a dynamic fintech scene creates an environment conducive to raising funds and managing financial operations. 

And in addition, Singapore's strategic location on the world map allows easy access to other major markets in Asia and beyond, making it a gateway for regional expansion.

Technological Ecosystem

The technological ecosystem in Singapore is vibrant and continually growing. The government has been heavily investing in digital infrastructure and innovation through initiatives like the Smart Nation program, while Singapore’s central bank is working on Project Ubin, which will use Ethereum to digitise the Singapore Dollar. 

This ecosystem has led to the development of cutting-edge technologies and a skilled workforce adept in blockchain and fintech. 

Collaboration between academia, industry, and government in Singapore further bolsters crypto innovation, providing startups with the resources and support needed to thrive.

Community and Networking

Singapore boasts a thriving community of blockchain and cryptocurrency enthusiasts. Numerous events, conferences, and meetups are held regularly, fostering a collaborative atmosphere where startups can network, share ideas, and find potential business partners or investors. 

Events like TOKEN2049, one of the largest Web3 events globally, and the Singapore FinTech Summit, draw international attention, further solidifying Singapore's position as a crypto-friendly city.

Tax Advantages

Taxation policies in Singapore are also favourable for cryptocurrency startups. There is no capital gains tax in Singapore, meaning profits from cryptocurrency investments are not taxed. This can be a significant advantage for startups looking to maximise their returns and reinvest in their growth.

Challenges and Considerations

Despite these advantages, there are challenges to consider if you’re an entrepreneur who is considering launching a cryptocurrency company in Singapore. 

For one thing, the crypto industry is still in its infancy and most policymakers haven’t fully decided how best to find the right balance between robust regulatory oversight and supportive growth initiatives. Rules, regulations and tax regimes are all still in flux, which means even in Singapore entrepreneurs can’t guarantee that things won’t change in the future. 

The global regulatory landscape for cryptocurrencies in other major markets can still impact Singapore-based startups as well. 

In addition, the sheer number of fintech companies that are setting up shop in Singapore means that any new crypto startup that chooses to launch here could face a war for talent - and that war is only likely to grow as Singapore’s global recognition as a leading crypto hub attracts even more startups.