Temasek’s Vertex Ventures says it has invested in the Binance digital currency exchange to help develop a fiat currency-to-crypto  platform in Singapore. Photo: iStock
Temasek’s Vertex Ventures says it has invested in the Binance digital currency exchange to help develop a fiat currency-to-crypto platform in Singapore. Photo: iStock

Binance, the self-proclaimed “world’s largest crypto-currency by daily trade volume” has been aggressively expanding in Southeast Asia. Those ambitions have been strengthened this week when Temasek’s Vertex invested in Binance to aid its expansion to the island state.

Vertex Ventures said it invested in the digital currency exchange to develop a fiat to crypto exchange platform in Singapore. According to Bloomberg, the funding is a joint investment between Vertex Ventures China and Vertex Ventures Southeast Asia & India. The amount invested, however, has not yet been disclosed.

Temasek Holdings, a Singaporean holding company owned by the government, is a limited partner for Vertex, but Temasek reportedly did not play a direct role in the transaction. Vertex is the oldest venture capital firm in the region and this investment is another institutional nod of approval for the crypto industry, which is growing in Asia faster than anywhere else.

In a blog post, Binance stated: “The investment by Vertex Ventures, which has backed numerous successful startups across the world, is a testament to the huge potential of Binance Singapore. Traditional institutional players have been increasingly active in blockchain opportunities in recent months, and this backing from one of the leading investors in Asia is a significant milestone for the region.”

The fiat to crypto exchange is expected to be launched before the end of the year and will enable users to buy crypto-currencies with the Singapore dollar. Hong Kong, and now Malta-based Binance, is currently a crypto-only exchange offering trading pairs in Bitcoin or other dollar-pegged stablecoins such as Tether. CEO Zhao Changpeng, who tweeted on the partnership, is keen to tap into the fiat markets.

Binance has recently launched a fiat to crypto trading platform in Uganda upon which users can buy Bitcoin and Ethereum using the Ugandan Shilling. This has been touted as its gateway into African markets.

Fiat to crypto platforms can be difficult to launch in certain countries as they require additional AML (anti-money laundering) and KYC (know your customer) regulations which is why some governments, such as China and India, have banned them.

In essence, they often require the same proof of identification as a bank would, removing the anonymity, and potential criminal elements, from crypto trading. Several nations in Asia including Singapore, South Korea, Japan, and Thailand all have their own fiat to crypto platforms and are currently supportive of this type of trading providing those regulations are adhered to.

Singapore has become a hub for blockchain investment and a top destination for crypto startups in the region following a series of crackdowns in China.

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