Singapore has overtaken Hong Kong in “regulatory efficiency and attractiveness” for crypto companies in 2024, according to Bloomberg.
The city-state has granted 13 crypto licenses this year, more than double the number in 2023. OKX, Upbit, Anchorage, BitGo and GSR have received regulatory permission, highlighting Singapore’s growing appeal for digital asset firms.
Hong Kong's licensing framework has made "slow progress" with seven fully licensed platforms and several others with provisional licenses.
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Organizational differences make the region competitive.
Industry watchers blame Hong Kong’s regulatory restrictions for the delay, saying strict limits on token listings, delistings and holding of assets make it difficult for exchanges to make a profit.
Angela Ang, Senior Policy Advisor at TRM Labs, said:
“Hong Kong’s exchange regulations are more stringent in areas such as custody of client assets, token listing and delisting. This may have benefited Singapore.”
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Singapore's balanced regulatory regime encourages new entrants and established financial institutions to cooperate.
The Guardian and Global Layer 1 project, backed by the Monetary Authority of Singapore, seeks to accelerate the tokenization of assets and the use of blockchain in wholesale financial markets, according to Bloomberg.
Singapore has become a strong regional headquarters for digital asset companies due to these initiatives.
Despite the sale of HK$6 billion ($770 million) in standardized green bonds and the emergence of Bitcoin and Ethereum ETFs, acceptance has been slow in Hong Kong.
These Hong Kong ETFs have $500 million in assets under management, compared to $120 billion in the US.