Singapore crypto exchanges: what to check before using one

Why check a Singapore crypto exchange before you deposit?

A deposit turns you into a creditor of the exchange until you withdraw. In September 2013 MAS warned that no identifiable party may be responsible for refunds if a Bitcoin service stops operating, and that warning still describes the basic risk. A check before the deposit costs minutes, and a surprise after it can cost the deposit. A short checklist replaces guesswork with evidence.

Price risk stays with you whichever venue you choose, so the checks target a different loss: the one that arrives when the exchange cannot return what it holds. A Singapore crypto exchange that passes all 7 checks leaves you with market risk alone, which you can size with a simple fall test.

Which legal entity runs the Singapore crypto exchange you use?

Start with the name of the company behind the app. The terms of service name a legal entity, a place of incorporation and a contact address. Look for a Singapore entity if you expect Singapore rules to apply, and note whether the terms send disputes to a court in another country. Save a copy of those terms with the date, since terms change and the saved version shows what you accepted.

Write down the name exactly as it appears. Later checks, such as the authorisation scope and the reserve report, refer to that entity, and a similar brand name does not count as the same company. Matching names to documents is the quickest way to spot a venue that borrows a reputation.

What does the authorisation of a Singapore crypto exchange cover?

MAS classified Bitcoin as a digital payment token under the Payment Services Act in April 2019, so token services sit inside a supervised perimeter. An authorisation names the activities a firm may perform. Read it against the services you plan to use: spot trading, transfers, custody, or anything else the app offers.

A firm can be authorised for one activity and offer another outside that scope. Ask which of the services you use appear in the authorisation, and treat an unclear answer as a signal. Keep a copy of the page or the confirmation you relied on, with the date, so you can show later what you checked.

How does a Singapore crypto exchange hold your crypto assets?

Custody terms say whose property your tokens are. Look for language that keeps customer assets apart from the exchange’s own assets, and for a statement of where the tokens sit: in wallets controlled by the exchange, with a third-party custodian, or in a mix. Segregation matters most when the exchange gets into difficulty.

Ask what happens if the exchange fails. A clear answer describes how customers recover assets and who handles the process. A vague answer, or none, tells you the exchange has not planned for the case. The more of your assets sit on one venue, the more weight this answer carries. Compare two venues side by side on this one question, and the stronger plan becomes visible quickly.

Does your Singapore crypto exchange publish audited reserves?

Audited proof of reserves shows that customer assets exist in the amount the exchange reports. A good report names the auditor, the date, the assets covered and the method. It should also compare assets with customer liabilities, because a list of assets alone does not show whether they cover what customers are owed.

Treat refusal to publish reserves as a risk signal. Treat a report that is old or limited to a single token as a partial answer, and ask for the rest. Reading the report once a quarter, and comparing it with the last one, shows whether the numbers move in a way that matches the exchange’s story.

How does a Singapore crypto exchange behave when crypto prices fall?

Read the terms for stress cases before a fall happens. Look for the rules on withdrawal delays, on forced liquidation of leveraged positions, on trading halts and on how the exchange handles a stablecoin that slips below its peg. Terms that spell these out in plain language show an exchange that has thought about bad days. Compare the rules across venues in the same way.

Test the process in calm conditions. Withdraw a small amount to your own wallet and note the time taken and the fees. A venue that returns a small test quickly gives you some evidence about its operations, and a venue that struggles with a small test is unlikely to handle a rush of requests during a crash.

How do you turn these checks into a routine for Singapore crypto exchanges?

Put the 7 checks on one page and date each answer. Repeat them each quarter and after any news that changes the exchange, such as a new owner, a new product or a change in terms. A dated page shows a trend, and a trend is more useful than a single snapshot.

Size your balance on the exchange to a loss you can carry, and keep long-term holdings in custody that you understand. To see how an exchange failure would affect your wider position, run the Λ simulator, or ask for a 30-minute review through the EQOS Asia contact page. See also the wider crypto crash series.

Frequently asked questions

About the author

Stéphane Jambu

President, EQOS Forecast Asia

Stéphane Jambu leads EQOS Forecast Asia and works as a consultant in e-commerce, search visibility, and AI. LinkedIn profile