Singapore digital asset custodian given the all-clear
Singapore-based digital asset custody firm, Propine, recently announced its successful graduation from the Monetary Authority of Singapore’s regulatory sandbox with a Capital Markets Services (CMS) License in hand. The CMS License is required in Singapore to engage in business activities prescribed under Singapore's Securities and Futures Act.
Propine say they are the:
first fully regulated independent digital asset custody service provider [to be] granted the CMS licence and the only digital asset custodian globally with ISO 27001 certification
Having been given the green light to operate in Singapore, Propine will be rolling out its range of digital asset custodial services. Propine participated in the sandbox for just over a year before receiving approval to exit. CEO Tuhina Singh expressed her gratitude to MAS for their regulatory support and the success of the experimentation period, saying they intend to be:
taking the lead in setting market standard practices and developing the ecosystem.
Propine intends to capitalise on its early access to the market and expand its services globally.
The announcement follows increased competition among custodians to secure private keys and gain the tick of approval to deliver their custody solutions. As the market for digital asset custody grows it is anticipated that traditional custodians will also seek to enter the market. Among those already competing for a slice of the pie include Singapore's DBS Bank and UK based firm Zodia, both of which are expected to launch digital asset custody services in 2021.
It has not all been clear sailing for existing digital asset management service providers with BitGo Inc. recently reaching a settlement with the US Department of the Treasury's office of Foreign Assets Control for just under USD$100,000 for 183 potential civil liability offences. These potential violations arose out of
deficiencies in BitGo's sanctions compliance procedures
leading to use of BitGo's services in sanctioned jurisdictions, serving as an important reminder of the reason AML/CTF Rules exist.
In Australia, the Australian Financial Services Licensing regime does not currently contemplate or accommodate an authorisation specifically for digital currency custodians and the regulatory guide addressing custody does not mention digital assets.
Absent there being clear paths for Australian custodians of digital assets, overseas services will secure the jobs and profits from this rapidly growing market. We hope this will change in the near future to help support Australia's financial sector as it deals with revolutionary changes.