Ripple has secured in-principle approval of an application for a Major Payments Institution License from the Monetary Authority of Singapore, which will allow a local subsidiary to offer regulated digital payment token products and services in the city state.
The approval will also allow the company to further scale customer use of its crypto-enabled On-Demand Liquidity service, the company said in a statement late Wednesday. The platform allows financial institutions to send money across borders instantly using XRP as a bridge currency.
Singapore "continues to be a global leader in establishing clear rules of the road to recognize the innovation and real-world utility of digital assets, and its benefits to the global financial system," Ripple CEO Brad Garlinghouse said in the statement.
Chief legal officer Stu Alderoty said many other countries are looking at Singapore's "early leadership in developing a clear taxonomy and licensing framework." For Ripple to get final approval from the country, it needs to take a few more steps to finalize the application, he said in a follow-up interview with The Block.
Circle obtained its Major Payment Institution license in Singapore earlier this month. Crypto.com also received the license on June 1 and said it would be able to continue to expand its Digital Payment Token services in the country.
U.S. is 'losing out'
Other countries including the UK, United Arab Emirates and more broadly, the European Union, have made strides to define rules for crypto, Alderoty said in the interview. “It’s no surprise then that the vast majority of Ripple’s business is outside of the U.S. in these key hubs that offer regulatory clarity,” he said, adding that the U.S. is "losing out."
With recent lawsuits filed against crypto exchanges Coinbase and Binance by the Securities and Exchange Commission and a slow moving Congress, some critics argue that the uncertainty is hindering innovation in the country. Others including SEC Chair Gary Gensler say current regulations are already in place to regulate crypto.
“We’re going to see the growth outside of the U.S. because the U.S. has not taken this forward looking regulatory approach or they haven’t even come up with a workable regulatory framework for this industry to survive in the U.S., let alone thrive in the U.S.,” Alderoty said, adding that regulatory clarity does not mean freedom from regulation.
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