As Singapore’s growth continues to challenge the world’s other financial services hubs, it’s also attracting bitcoin entrepreneurs who see it as fertile ground for a more disruptive kind of innovation.
Singapore’s unique position as a fully independent city-state in the middle of Asia has served it well over the past few decades.
Both policy decisions and geopolitical fortune have seen it achieve one of Asia’s highest standards of living, a high concentration of millionaires, and $450 billion in offshore assets under management (half of which are from China).
Expats have long flocked to Singapore from Commonwealth countries, but new and wealthy communities have begun to arrive from places like Japan, Hong Kong, and the United States.
They’re here for the money and tropical lifestyle, fleeing dormant economies and more forbidding regulatory environments back home – and have brought Singapore’s foreign resident population to 2 million of its total 5.5 million.
Add to that a thriving IT industry covering hardware production, education and Asia’s most active network of startup incubators, and bitcoin enthusiasts are taking note.
Steve Beauregard is the Founder & CEO of GoCoin, a startup bitcoin payment processor founded in April 2013 with a private beta launching after the end of summer.
The Californian arrived in Singapore just a few weeks ago and plans to settle for good once he can relocate his family.
Though local customers are not the company’s primary target for now, GoCoin will be based in Singapore with plans to draw from the growing pool of local IT talent and be central to large regional populations of underbanked people.
“Unlike California, the Singapore government is very efficient and pro-business. They have many startup incubation schemes which are perfect for early-stage companies looking for a leg up,” said Beauregard.
“It’s a strategic initiative to not only launch where our competition isn’t but to domicile in a progressive country, where innovations like bitcoin are encouraged and not stymied by legal subpoenas from both state and federal levels struggling to understand what is evolving.”
GoCoin plans to innovate in the bitcoin payment processing sector by opening its API and allowing eCommerce developers to fully integrate with it. In the spirit of open systems and the trust economy, GoCoin will keep “no special powers” and further provide a built-in reputation management system.
“With bitcoin payments being final, we see the merchant rating system as critical to providing a fair gateway platform,” Beauregard said.
The Singaporean bitcoin meetup he co-hosted last week was impressive in the number of attendees and, while it didn’t have the “big guns” of the bitcoin ecosystem found at his Los Angeles gathering, he found the group had a passion and technological depth equivalent to those across the Pacific.
As a US citizen, Beauregard has been taken aback by international finance’s newfound reluctance to deal with Americans. That reluctance has included both bitcoin exchanges and regular Asian banks.
“I’ve now sent seven different ID documents to Mt. Gox and they still will not verify my account,” he said. “And the banks here in Singapore were quite open telling me to my face, ‘We don’t open accounts for American citizens.’”
There’s no guarantee that Singapore’s own regulators will be any kinder to bitcoin in the long run. Indeed, just this week the Monetary Authority of Singapore (MAS) warned bitcoin traders to “be wary” of the currency due to an inability to identify individuals behind transactions.
That warning sounds tame compared to other countries’ pronouncements questioning bitcoin’s very legality, however, and MAS has not yet announced any plans to regulate bitcoin.
In fact they have taken a more positive stance than their statement suggests, treating bitcoin like any closed virtual currency.
There is also the question of whether a jurisdiction so heavily associated with traditional financial services will embrace such a new form of currency or asset without any backlash.
Big government and big finance aside, the number of small traders accepting bitcoin in Singapore is growing thanks to its active IT sector.
GoCoin has signed up “about a dozen” merchants internationally for its initial private beta, mostly companies well familiar with bitcoin like mining hardware vendors, and also other hardware, software and gadget vendors.
“They were some of the easiest software sales I’ve ever made, and I’ve been in this industry for 20 years,” Beauregard said. “We said ‘minimal fees, no chargebacks,’ and it was like ‘where do I sign?’”
Convincing other industries to jump on board may be as challenging as bringing the traditional financial sector into the bitcoin world.
“It’ll be a long grind I know, but I’d love to go after telcos, for that time in the future when you’re all carrying bitcoin around on a mobile phone.”
Feature image: gocoin.com