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Singapore Crypto Users Strict Auth Process

Earlier this month, crypto exchanges like Crypto.com and Gemini said they would be taking new steps to make sure they were following the Travel Rule, which is a set of rules for how money can be moved.

Singapore Crypto Users Strict Auth Process iBase Trading.
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Earlier this month, crypto exchanges like Crypto.com and Gemini said they would be taking new steps to make sure they were following the Travel Rule, which is a set of rules for how money can be moved. The rule has been added to the Payment Services Act by the Monetary Authority of Singapore (MAS).

According to this new rule, users will need to give more information when they send or receive digital tokens.

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In the past, such transfers could be made by giving a wallet address. When crypto exchanges start to ask for more information, like the names of people who are in a deal, they’ll need more information.

If the value of the transaction is more than S$1,500, other information, like the sender’s ID number and home address, will also be needed.

Whether the transaction is done through a decentralized wallet or through another crypto exchange, this rule will still be in place.

Implementation of Crypto Travel Rule

As of January 2020, all crypto exchanges in Singapore with a payment services license have had to follow the rule about not going on trips.

Most exchanges in the country, on the other hand, are still running while their applications for licenses are being looked at. As a result, they haven’t had to put in the travel rules yet.

Crypto.com wants to be fully compliant by 2022, so it’s going to start putting things in place now to do that. To start, users will need to tell us who they’re doing business with and where the money is going. The details will only need to be given once, after which they will be linked to the wallet address.

Gemini users will need to show that they own any decentralized wallets they want to use to make transactions starting in March 2022. To get or send money between Gemini and a decentralized wallet, both must belong to the same person. This means that it will not be possible anymore.

There will also be a seven-day wait after you submit a new wallet address.

Crypto Travel Rule

The goal of the travel rule is to help people spot suspicious transactions and take action when necessary. In the future, crypto exchanges will be able to freeze accounts and stop people from making transactions if they’re deemed to be illegal.

Such a system, when it is used all over the world, will help stop crypto scams and frauds.

As it stands, crypto exchanges are the main way into the world of decentralization. Even though these exchanges ask for ID proofs, there’s no way to prove who owns the money once it’s moved to a decentralized wallet, so there’s no way to know who owns it.

The travel rule will help exchanges figure out who owns decentralized wallets by cutting down on the anonymity barrier.

If someone tries to move money from a decentralized wallet to an exchange, the exchange will be able to tell. The scammer would then be able to be prosecuted by the right people.

Trustworthy Technique

Even though the travel rule will help stop scammers, there are still ways they can hide their crimes, like by using a cryptocurrency mixer to hide their crimes.

During the first week of January, hackers broke into Crypto.com and stole US$15 million. They then used a mixer called Tornado Cash to get the money back.

A mixer takes crypto from a lot of different wallets and uses an algorithm to make the funds look different. The money would then be granted who are in need.

People who send things do not have a direct connection with the people who get them. As a result, it is now impossible to figure out which wallet a scammer might have sent their money to.

Experts Opinions

Confidentiality has long been thought to be an important part of a world that isn’t centralized. Regulators, on the other hand, may need to be put in place to protect the interests of consumers without slowing down blockchain innovation.

Danny Chong, a blockchain entrepreneur and co-founder of the DeFi start-up Tranchess. He sees no issue with cryptocurrency exchanges doing more to ensure their safety. That might be good for getting more people into the space.

Chong thinks that about 80% to 90% of the world isn’t in this space because of the anonymity. More people might join if things are more clear and there are precautions against somebody pulling their rug out. Regulations for crypto exchanges do not preclude people from being anonymous in a decentralized environment, argues Chong.

In this analogy, Singapore is the space that isn’t very organized. The rules don’t stop people from making or using blockchain technology. They only make sure that the money being used for this was not obtained illegally.

It’s the same when people try to get money out of or leave Singapore. He says that at the start and when you’re leaving the system, KYC and checks should be the strictest.

“The views and opinions on this Crypto News Website are solely those of the authors and contributors. These views and opinions do not necessarily represent those of iBaseTrading or its partners.”

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Jane De Leon is a news writer covering all things related to DeFi and NFTs. In the past, she has worked for a well-known Business Newspaper. She originally began investing in Bitcoin after hearing about it from her brother and hasn’t looked back since.