Digital Currency Group’s Luno crypto exchange has disclosed its plans to shut down operations in the Singapore market,…
Digital Currency Group’s Luno crypto exchange has disclosed its plans to shut down operations in the Singapore market, which is expected to take place later in June. The move is alleged to be part of a regular evaluation of the firm’s global strategy and presence.
In a blog post on Monday, Luna announced that its services would no longer be available in Singapore as of June 20. In its candid imploration to its users, it asked them to withdraw their assets from their Luno wallets by June 19. The exchange also told the Monetary Authority of Singapore that it no longer needs a permit.
“As a result of this decision, we have also informed the Monetary Authority of Singapore (MAS) of our intention to withdraw our license application. Our operations in other regions are not impacted by this decision.”
Why Luno is leaving the Singapore Market
Luno, which obtained a license to operate in Singapore in April 2022, has been at the receiving end of the nation’s uptight stance on cryptocurrency, which has attracted several reassessments of the crypto potential there, considering Hong Kong’s gradual development as a hub for digital asset firms. Luo, however, stressed that Singapore still has the potential to use crypto to build a fair and robust financial system.
“Since June 2013, the Monetary Authority of Singapore (“MAS”) has been cautioning consumers and businesses of the significant risks associated with virtual currency transactions. Following the boom in initial coin offerings (“ICO”) in 2016, the MAS clarified in August 2017 that ICOs must comply with existing securities laws aimed at safeguarding investors’ interest if a token is structured in the form of securities,” the statement reads.
“In a Consumer Advisory issued in conjunction with the Commercial Affairs Department on 10 August 2017, the MAS also advised consumers to exercise due diligence to understand the potential risks associated with ICOs and investment schemes involving digital tokens.”
“Fast forward half a decade later to 2022 – a year marked by the collapse of the algorithmic stablecoin TerraUSD, and the downfall of major players such as crypto lenders Voyager Digital, Celsius Network, and BlockFi, crypto hedge fund Three Arrows Capital, and more recently, FTX.
In January 2022, the MAS introduced measures to restrict the marketing and advertising of cryptocurrency services in public areas and disallow cryptocurrency trading being portrayed in a manner that trivialises its risks.”
In 2020, the embattled crypto conglomerate DCG purchased Luno, which also has significant interests in the United Kingdom and South Africa. Luno is one of many companies that have let off employees in recent months as the crypto sector has shrunk.
In-principle permits have been granted to over a dozen organizations, including Coinbase Global and Blockchain.com, to provide digital payment token services in Singapore.
Going forward, Luno insists and warns sternly that it will charge an inactive account fee for unclaimed funds. If a user hesitates to withdraw their assets before June 2019, 2023, Luno will be given the right to sell them at the growing market price and convert them to SGD, with a spot buy/sell fee of 0.75% applied.
Also, Luno reserves the right to charge a monthly inactive account fee for holding SGD on behalf of users after the deadline.
Taking a bow out of the Singapore market, Luno is quick to express its immense appreciation for the support gotten from its Singaporean users: “We have been privileged to support thousands of investors in Singapore on their crypto journey since 2016 and would like to thank everyone who has entrusted their investments to us.”