Singapore Law Ministry Announces The Cryptocurrency Is Not Considered Legal Tender, Warning Companies Not To Accept As Payment
Cryptocurrencies have been working to find their place in various jurisdictions as countries around the world categorize them for tax purposes, payments, and more. As friendly as Singapore has been to this industry, the Ministry of Law has decided to impose a bill that ensures that cryptocurrency is not accepted as legal tender.
The Ministry of Law is warning businesses to stay away from the use of cryptocurrency. The changing value makes it difficult to be used for a certain payment, and businesses need to fully vet their clients before accepting any cryptocurrency as a fulfilment of products or services. This warning was reported by The Business Times, following the partnership of SK Jewellery and Bizkey Network that makes it possible for the business to accept Bitcoin and altcoins as payment.
With all of the suspicion around these types of actions, especially in the precious stone business for money laundering, the authorities felt the need to remind customers of their digital asset policies. Local jewellery businesses believe that they are presently in accordance with the rules and regulations imposed by the government, and do not believe that they are violating laws by accepting cryptocurrencies.
A spokesperson for jewellery told The Business Times,
“The acceptance of crypto merely serves as another option of payment for our customers and, other than it being a more unconventional mode of payment now, it’s business as usual.” The spokesperson also insisted that this sector has opted to “partake in the growth story of the digital economy without exposing itself to unnecessary volatility in the cryptocurrency markets.”
The aforementioned collaboration between SK Jewellery and Bizkey are promoting their new partnership with a “Token Day” campaign, which is planned to last for an entire week. The promotion will go until January 27th, and customers will be privy to up to 20% discounts for cryptocurrency purchases of gold and diamonds. A three-hour flash sale brought in over S$30,000 worth of transactions, which led Bizkey to consider the campaign a major success.
Despite the promotion and the profits, the Ministry of Law remains skeptical of the initiative, saying that money laundering could essentially become more likely. A spokesperson for the Ministry said,
“This would include consideration of the risks posed by non-cash – for example, cryptocurrency-based – transactions.”
Elaborating, the spokesperson said,
“Therefore, businesses which choose to accept cryptocurrency payments should ensure that they have sufficient measures in place to mitigate potential money laundering and terrorist financing risks, which may arise from these modes of payment. In addition, businesses should perform their due diligence before accepting cryptocurrency payments, as cryptocurrencies are not legal tender.”
With how efficiently the crypto market in Singapore has been moving, it has been a long time since the authorities were worried about illegal transactions for the precious stones market specifically. However, apart from crypto, the Ministry had just published a bill last week that hopes to fight against the money laundering and terrorism financing that occurs in that industry. The bill covered all areas with the potential for this kind of fraud, including digital asset payments. To resolve the concerns, the bill brought forth a potential framework to fight it.