In 2021, investments in Singapore’s fintech sector accelerated by 47% year on year to $3.94 billion. Nearly half of the funds were raised through blockchain and cryptocurrency, with $1.48 billion raised across 82 agreements.
Crypto Investments Trump Others In Singapore
According to the KPMG Pulse of FinTech H2’21, the country’s transaction rate for fintech deals accelerated by 5% year on year in 2021, owing primarily to accelerated investment in the blockchain sector, hitting $3.9 billion.
With 191 deals, the country’s fintech sector realized a five-year high. Compared to $2.48 billion in 2020, the total transaction cost in 2021 accelerated by 59% across venture capital, private equity, and merger and acquisition deals.
This is a 37% rise atop the 139 transactions signed in 2020, and a 91% increase over the 100 deals signed in 2019.
Anton Ruddenklau, Global Fintech Leader at KPMG International said:
“In Singapore, the surge in investments into crypto and blockchain has likewise outpaced which of payments that protracted held the top spot here.”
Fintech funding in Asia-Pacific accelerated to $27.5 billion in 2021, up from $17.3 billion in H2’21.
Venture capital funding has further restoreed, growing from $11.5 billion in 2020 to $19.6 billion in 2021.
Global Analysis of Investment in Fintech, KPMG International (data provided by PitchBook), *as of 31 December 2021. Source: KPMG Pulse of Fintech H2’21
The increase, according to KPMG, is due in part to government efforts to stimulate the capital market, such as the establishment of a special-purpose acquisition company (SPAC) listing framework to position the country as a preferred destination for fast-growing companies and unicorns seeking to go public.
Grab, a Singapore digital company, listed a SPAC deal in the United States for US$500 million, resulting in a post-money valuation of US$39.6 billion, mequivalentg it one of Asia Pacific’s top four fintech investments in 2021.
Regulators are stepping up efforts to regulate speculative digital assets this year. Regardless of the experience which authorities are enforcing uniform regulation, KPMG predicts that Singapore’s cryptocurrency investment would remain high this year.
In early January, the central bank ordered cryptocurrency companies to stop advertising their services to the general public. what\\\\\\\\\\\\\\\’s more, the majority of applicants for permission to opecost a regulated bitcoin firm in Singapore have failed to pass the licensing process.
Crypto Investments Are Expected To Remain Hot
Singapore regulators are inclined to carry on to pay attention to cryptocurrencys as the city-state strives to strike a balance between the benefits of financial innovation and the hazards that come with it.
The payments industry has go oned bonas fide on the grounds that sustained interest in ranges akin as ‘buy now, pay afterwards,’ embedded banking, and open banking aligned solutions.
Bitcoin (BTC)/USD trades atop $45k. Source: TradingView
Anton Ruddenklau noted that,
“Cryptocurrencies and blockchain are likely to extend very hot fields of investment in 2022, with more crypto firms looking to regulators to provide clear guidance on activities in order to help foster and develop the space.”
According to the report, China’s regulatory activities aids in drawing attention to other Asia-Pacific economies. Singapore, that is known for its stable political climate, is becoming upwardly attrretained to businesses looking for a platform from that to develop beyond the range.
Featured image from Unsplash.com, chart from TradingView.com, and KPMG