Binance Stays Put in Singapore Amid Regulatory Crackdown on Crypto Firms

Singapore, long regarded as Asia’s premier hub for cryptocurrency innovation, is tightening its grip on the digital asset industry. The Monetary Authority of Singapore (MAS) has set a firm deadline of June 30 for crypto firms incorporated in the city-state but operating offshore to either obtain a license or cease regulated activities. While this move has sparked fears of an industry exodus, Binance—the world’s largest cryptocurrency exchange—appears largely unaffected, with plans to retain hundreds of remote workers in Singapore despite not holding a local license.

A Regulatory Reckoning for Crypto

The MAS’s latest regulatory push, detailed in statements on May 30 and June 6, targets a loophole that has allowed crypto firms to base operations in Singapore while offering services exclusively to overseas clients. Under the updated rules, such entities must now secure a license under the Financial Services and Markets Act (FSMA) 2022 or halt their activities. The MAS clarified that individuals employed by foreign-incorporated companies providing services outside Singapore are generally exempt from licensing requirements, provided their work does not constitute a “place of business” in the city-state.

However, the definition of “place of business” remains ambiguous. Chris Holland, a partner at Singapore-based consulting firm HM, cautioned against over-reliance on remote work as a shield. “The definition of ‘place of business’ is broad under the FSMA. While the term will have a boundary, I would not encourage firms to engage people resident in Singapore and then rely exclusively on that definition to work remotely, assuming that it’s outside the remit of the new rules,” Holland said.

For Binance, which has been on Singapore’s investor alert list since 2021 for soliciting local customers without a license, the new regulations appear to have minimal impact. Sources familiar with the company’s operations, who spoke on condition of anonymity due to the confidential nature of the information, revealed that hundreds of Singapore-based employees will continue working remotely. These employees primarily handle back-office functions such as compliance, human resources, data analysis, and technology—roles that do not directly trigger licensing requirements under the new rules. A Bloomberg News analysis of LinkedIn profiles found over 400 Binance workers listing Singapore as their base, though the company declined to comment on its operations or confirm the existence of a physical office in the city-state when approached by Bloomberg.

Singapore’s Crypto Conundrum

Singapore has cultivated a reputation as a global leader in fintech and blockchain innovation, with a licensing framework that has attracted major players like Coinbase Global and OKX to establish regional hubs. Yet, the city-state’s crypto-friendly stance has been tested by high-profile failures during the industry downturn of 2022, including the collapse of Three Arrows Capital, a crypto hedge fund that imploded after a series of disastrous investments. These incidents have prompted regulators to adopt a more cautious approach, balancing the desire to foster innovation with the need to protect investors and maintain financial stability.

The June 30 deadline has fueled uncertainty about Singapore’s long-term commitment to the crypto sector. Raagulan Pathy, co-founder of Kast, a Cayman Islands-based stablecoin startup, expressed concern over the city-state’s evolving stance. “There’s a lot of uncertainty on Singapore’s stance on crypto” Pathy said. Kast had initially planned to relocate internal operations staff, trading teams, and executives to Singapore, alongside hiring 30 to 50 local employees. However, in light of the regulatory changes, Pathy has opted to establish a global office in Dubai instead. “Even though Singapore is merely plugging a regulatory loophole, the perception is it’s clamping down on crypto and that could push capital and talent out,” he added. Pathy, a 12-year resident of Singapore, emphasized that his personal plans to remain in the city are unchanged, but business decisions must prioritize regulatory clarity.

Other major exchanges, including Bitget and Bybit, are reportedly considering moving staff overseas in response to the MAS’s hardline stance. This potential outflow of talent and capital raises questions about whether Singapore risks losing its status as Asia’s crypto fulcrum—a title it has held through a combination of progressive policies and strategic positioning as a financial gateway between East and West.

Binance’s Global Ambiguity

Binance’s ability to weather Singapore’s regulatory storm is emblematic of a broader strategy that has long frustrated regulators worldwide. The exchange has famously avoided naming a global headquarters, maintaining an air of operational ambiguity that complicates oversight. Richard Teng, Binance’s CEO and a former director at the MAS, acknowledged in 2024 that the company had engaged in discussions with various jurisdictions about establishing a formal base. However, in January, Teng described Binance’s workforce as “remote-first,” a model that appears to insulate its Singapore-based staff from the latest regulatory requirements.

This remote-first approach aligns with a growing trend in the crypto industry, where firms leverage distributed workforces to navigate fragmented regulatory landscapes. For Binance, the lack of a physical office in Singapore—combined with the nature of its employees’ back-office roles—seems to provide a buffer against the MAS’s crackdown. Yet, the broader implications of such strategies remain unclear. If other firms follow suit, relying on remote work to sidestep licensing obligations, regulators may be forced to revisit definitions like “place of business” to close remaining loopholes.

Industry-Wide Impacts and Regional Shifts

The MAS’s actions reflect a wider trend across Asia, where governments are grappling with how to regulate an industry that often operates beyond traditional borders. Singapore’s approach contrasts with more permissive jurisdictions like Dubai, which has actively courted crypto firms with favorable policies and tax incentives. For startups like Kast, the allure of such destinations is growing, particularly as Singapore’s regulatory environment becomes less predictable. The potential migration of crypto businesses to places like Dubai could reshape the regional landscape, diverting investment and innovation away from established hubs.

At the same time, the MAS’s focus on tightening oversight is not without merit. The collapse of firms like Three Arrows Capital exposed vulnerabilities in Singapore’s crypto ecosystem, highlighting the risks of unchecked growth. By enforcing stricter licensing requirements, the city-state aims to weed out bad actors and ensure that only credible, compliant firms operate within its borders. However, striking the right balance is proving challenging. If the perception of a crackdown persists, Singapore may inadvertently cede ground to competitors eager to position themselves as the next big crypto hub.

The Road Ahead

As the June 30 deadline approaches, the crypto industry in Singapore stands at a crossroads. For Binance, the ability to maintain a significant remote workforce in the city-state offers a semblance of stability amid regulatory upheaval. Yet, for smaller players and startups, the path forward is less certain. The MAS’s commitment to closing regulatory gaps may enhance long-term confidence in Singapore’s financial system, but it risks alienating an industry that thrives on flexibility and innovation.

Whether Singapore can retain its crown as Asia’s crypto capital remains an open question. As firms weigh their options and regulators refine their approach, the coming months will reveal whether the city-state’s latest measures mark a necessary recalibration—or the beginning of a broader exodus.