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Singapore crypto market rises after China crackdown

Singapore emerges as the cryptocurrency hub in the Southeast Asian region amidst the China crackdown on digital currency transactions. This led to major digital exchanges including Huobi, Bybit and OKCoin to uproot their operations in the country and shift towards the Singapore crypto market. 

In addition to this, Babel Finance, a crypto lending company, recently opened an office in Singapore following the announcement of the ban. 

‘On the very day we saw the notice, we started to take corrective measures’, Dun Jun, co-founder of Huobi Group, said to Reuters.

Another Chinese crypto asset management and custodian exchange, Cobo also moved its offices to Singapore.

Currently, these exchanges have stopped registering Chinese accounts and are in the process of closing existing ones by the end of the year.

Singapore created a crypto-friendly environment that welcomed exchanges and investors from China. This led to the increased inflow of crypto activities in the country as well as the growth of the local crypto market. 

The city-state is also considered a critical financial centre in the Asian region. Singapore embraced fintech into its economy and has improved its crypto-related legislation provided through the Payment Service act imposed by the Monetary Authority of Singapore (MAS to accommodate more crypto business.

Last September 24, the Chinese government led by the People’s Bank of China (PBOC) along with other regulatory agencies in the country announced the plans of criminalising all crypto-related activities including trading digital assets.

The regulatory body summoned the country’s major commercial banks and the biggest payment service provider, Alipay. They warned these financial service companies to halt any crypto-related services to their clients. 

This caused Bitcoin, the biggest asset in the global crypto market to plunge from US$47,269 on September 24 to US$41,637 by September 29, five days after the China crackdown announcement. 

According to Babel Finance Chief Executive Officer Flex Yang, the regulatory crackdown would only have a limited impact on the crypto sphere since many crypto companies moved out of China over the past few months amidst the ban rumours.

Despite the ban on Chinese exchanges, crypto platforms including Huobi, OKEx and Binance posted a 62% increase in their trading outflows compared to their 2020 performance. The data was provided by PeckShield, a cryptocurrency research consultancy. 

However, some crypto firms and fintech companies took a beating in their stock market shares amidst the crackdown. Huobi Global affiliate Huobi Tech plunged 22% after the crypto ban. OKG Technology Holdings Ltd, owned by Xu Mingxing, OKcoin founder, also dropped 19% in the stock market.

Crypto mining also plunged after China outlawed the said activity. Chinese mining machine providers like Caanan Inc. and Ebang International lost 21% and 7% of their share values respectively. 

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