Singapore strengthened its position as a digital assets hub in 2024, issuing 13 new crypto licenses to operators such as OKX, Upbit, Anchorage, BitGo, and GSR, according to a report from Bloomberg. This is more than double the licenses granted in 2023, signaling significant momentum in the city-state’s efforts to attract digital asset firms.
In contrast, rival financial center Hong Kong has faced challenges in gaining traction. Despite implementing a similar licensing regime, approvals in Hong Kong have progressed at a slower pace. Regulators in the city authorized four platforms with some restrictions last Wednesday, bringing the total fully licensed exchanges to seven. An additional seven platforms hold provisional permits, but prominent firms like OKX and Bybit have withdrawn their applications.
Both cities are vying to attract digital asset firms through tokenization projects, regulatory sandboxes, and licensing initiatives. However, the approaches have diverged, with Singapore seemingly outpacing Hong Kong.
“Hong Kong’s regulatory regime for exchanges is more restrictive in a number of ways that matter — such as custody of customer assets and token listing and delisting policies,” Angela Ang, senior policy adviser at consultancy TRM Labs, told Bloomberg. “This may have tipped the balance in Singapore’s favor.”
Hong Kong’s licensing framework only permits trading in highly liquid cryptocurrencies like Bitcoin and Ether, excluding smaller and more volatile altcoins. This policy has limited opportunities for investors and exchanges.
“It’s quite a high standard to meet and be profitable,” said Roger Li, co-founder of One Satoshi, a chain of over-the-counter crypto stores in Hong Kong.
China’s ban on crypto trading has also added complexity to Hong Kong’s appeal. While Hong Kong operates under a special administrative regime, its proximity to mainland China creates a distinct risk profile compared to other regions.
Singapore’s supportive regulatory environment has emerged as a clear advantage. David Rogers, regional chief executive at market maker B2C2 Ltd., emphasized the city-state’s appeal, describing Singapore as a “safe, long-term choice” for establishing a regional hub. “It is a risk-adjusted approach we’re taking here,” he told Bloomberg.