Singapore-based trading platform ADDX has become the first financial firm in the city-state to accept cryptocurrencies as proof of accredited investor status or in other words high-net-worth clients. The recognized assets are Bitcoin [BTC], Ethereum [ETH], and Tether [USDC].
ADDX in a statement on Wednesday stated that it would recognize only those cryptocurrencies that have a higher market cap and would apply discount rates when valuing these assets.
Doubling down on the digital assets market, ADDX CEO Oi-Yee Choo said,
“Cryptocurrencies are here to stay. They no longer exist only on the fringes of wealth and investment conversations”.
“With a large minority of investors owning crypto, it is reasonable for these digital assets to be recognized as a part of one’s portfolio – not unlike any other assets that can be valued in the marketplace, such as real estate or equity,” Choo added.
Under Singapore’s law, individuals need to have at least $217,991 of income from the past 12 months, $1 million in net financial assets, or $2 million in net personal assets to qualify as accredited investors.
ADDX also divulged that it will accept crypto assets only in the category of net personal assets and will apply a 50% discount rate for bitcoin or ether when calculating the value of these holdings and a 10% discount for USDC stable coin.
On the contrary, Singapore’s Deputy Prime Minister Heng Swee Keat has advised retail Investors to stay clear of cryptocurrencies citing that they are “highly risky.” He stressed, “We cannot express this enough.”
Singapore’s Deputy PM Urged Investors To Refrain From Crypto Trading
Speaking along the sidelines of the recently held Asia Tech x Singapore [ATxSG] summit, the minister took a critical note of the fallout of cryptocurrency terra [LUNA] and algorithmic stablecoin terrausd [UST], where many investors reportedly lost millions and used it as an example to support his point.
Singapore has maintained a cautious approach toward crypto, with the country’s central bank, the Monetary Authority of Singapore [MAS], as the main regulator of the crypto sector.
For the last two years, the MAS has only granted licenses and in-principle approvals to 11 digital payment token service providers. As per reports nearly 100 entities have failed to meet regulator requirements.