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Recently, there have been several media reports about cryptocurrency firms, including Binance and Huobi setting up their “headquarters” in Singapore or, alternatively, withdrawing from Singapore. In this article, we discuss what having a “headquarters” means, what information about a business customer should care about most, and some of the issues global fintech businesses should consider with respect to the Singapore market.


In the last three months, media reports about how cryptocurrency businesses are setting up in Singapore include:

  • stories about Binance1:
    • a story that Binance Singapore may withdraw its Singapore license application and set up a “global base” elsewhere (the “December Binance Story”);2
    • a podcast episode from the Wall Street Journal highlighting issues regarding Binance’s lack of a headquarters;3 and
    • a story in Forbes about Binance restricting services to Singapore residents.4
  • news about Huobi5:
    • a Fortune story that Huobi is halting all services for Singapore based-users;
    • a letter from Huobi Singapore that it will launch its Singapore platform by the end of 2021;7
    • a Bloomberg story that Huobi has picked Singapore as its regional headquarters (the “December Huobi Story”).8
  • news about Singapore, including a Bloomberg article that Singapore has grand ambitions to become a global crypto hub.9

Based on these reports, it is clear that cryptocurrency businesses are grappling with the best way to ensure their legal and operational structures are compliant with applicable law without forfeiting market share or lucrative revenue streams.


General requirements

In general, there is no requirement for a global business to have a “headquarters”. If a global business wishes to centralize the management function, it may set up a corporate headquarters. Ordinarily, a global business’ “headquarters” may be the place of business (1) where business activities were initially launched, (2) of the entity with the largest operations by revenue or number of employees, (3) of the parent company within the global organization or (4) the entity that employs the business’ Chief Executive Officer.

A global business can operate under many structures. Typically, each legal entity within a group structure is managed by the local entity’s Board of Directors. A corporate shareholder’s or headquarters’ power is derived from its ability to control the Board of Directors of the local entity and replace Directors who are deemed unsatisfactory. Operational decisions of the local entity, such as hiring or firing staff, commencing new business lines and other matters, cannot be dictated by a corporate headquarters against the instructions of the local entity’s Board of Directors.

Corporate structures and servicing a global customer base

There are many ways to operate a global fintech business, including:

  • setting up a global business in one country and
    • conducting unregulated activities that allow you to market your business globally; or
    • conducting regulated activities in your home jurisdiction and complying with applicable solicitation requirements for countries where you do not have a physical/licensed presence, including potentially only accepting offshore customers on an unsolicited/ reverse enquiry basis;10
  • setting up regional hubs (subject to the same regulatory issues described above); or
  • setting up a domestic business (either an affiliate or a branch) in each country where you have customers.

The optimal model for a business will depend on various factors such as the operating costs and ability to find employees in each country where you have customers, management preferences, or customer requirements.

Conducting revenue generating activities from a headquarters

For a global fintech, the headquarters may or may not have contractual relationships with the business’s customers and counterparties. For example, in the December Huobi Story, it was reported that the regional headquarters that Huobi was setting up in Singapore would not have contractual relationships with Singapore residents. Instead, Huobi’s regulated activities in Singapore would be conducted by Huobi Singapore.

A wide range of factors, including tax and regulatory considerations, may impact the details of the operations conducted by a global business’ headquarters. Regardless of the foregoing, a parent company of a global business may recognize revenues on a consolidated basis even if the contractual relationships are held by subsidiaries. In addition, a headquarters may recognize taxable income based on transfer pricing studies due to the services provided by the headquarters to affiliated companies.


Even if a business does not have a “headquarters”, we believe it is a red flag if a cryptocurrency exchange does not identify a customer’s contractual counterparty in the exchange’s terms of business and would advise customers to conduct further due diligence. For the customer, relevant considerations include:

  • is the cryptocurrency exchange regulated in its home jurisdiction?
  • is the customer comfortable with:
    • the laws/regulator of that jurisdiction;
    • its ability to file a claim or enforce a judgement against the counterparty; and
    • the financial condition/reputation of the counterparty.


If a company is considering applying for a license in Singapore, some of the issues to be considered include:

  • How important is the Singapore market to your business?
  • How does Singapore fit in terms of your global strategy? Do you intend your Singapore regulated entity to service customers in other jurisdictions?
  • What is your projected profitability? What are the key assumptions that these projections are based on?
    After applying for a license, any change in these factors may cause a company to withdraw its license application or cease regulated activities if it is already licensed.


The current fact pattern in which neither Huobi nor Binance intends to continue to service Singapore customers, even on an unsolicited basis, suggests that they determined the benefits of allowing Singapore customers to access their global services were outweighed by other factors. We do not know the specific issues they faced or how the considerations could be different for cryptocurrency businesses that do not have a Singapore affiliate applying for a license under the Payment Services Act.

If Binance Singapore’s license application were withdrawn, Binance could potentially revisit its decision to not service Singapore customers. If offshore cryptocurrency businesses are not able to service Singapore customers, there is a risk that other jurisdictions will follow suit and not allow Singapore to act as a hub where Singapore businesses can service customers resident elsewhere in Asia. While the ability of an offshore business to service Singapore residents will depend on the facts and circumstances of each case, there is no doubt that Binance is one of the biggest cryptocurrency exchanges and a relevant benchmark for other firms looking at how to operate in Singapore and service Singapore customers.

For further information, contact:

Chris Holland: Partner | Holland & Marie | 201802481R 7 Straits View, Marina One East Tower, #05-01 Singapore 018936

Disclaimer: The material in this post represents general information only and should not be relied upon as legal advice. Holland & Marie Pte. Ltd. is not a law firm and may not act as an advocate or solicitor for purposes of the Singapore Legal Profession Act.

[1] “Binance” refers to Binance’s main platform.  “Binance Singapore” refers to Binance Asia Services Pte. Ltd. which has applied for a license under the Payment Services Act in Singapore.

[2] Olivia Poh. “Binance’s Singapore crypto hub plans in regulatory limbo” Business Times. 2 December 2021

[3]  Linebaugh, K and Knutson, R (Hosts), The Rise of Binance – And The Effort to Reel It In [Audio podcast episode]. In The Journal, WSJ Podcasts. 30 November 2021

[4] Zinnia Lee. “Binance To Ban Singapore Users From Crypto Trading And Buying On Its Global Platform”. Forbes. 28 September 2021

[5] Huobi refers to Huobi Global.  “Huobi Singapore” refers to FEU International Private Limited, a company currently exempt from licensing under the Payment Services Act.

[6] Yvonne Lau. “One of the world’s top crypto exchanges is shutting accounts in Singapore, weeks after it exited China”. Fortune. 10 November 2021

[7] Huobi Singapore. “Huobi Singapore Reiterates its Commitment to Local Users Amidst Huobi Global’s Decision to Exit From Singapore Market”. LinkedIn. 10 November 2021

[8] Chanyaporn Chanjaroen, and Zheping Huang. “China’s Biggest Crypto Exchange Picks Singapore as Asia Base”. Bloomberg. 30 November 2021

[9] Chanyaporn Chanjaroen, Haslinda Amin, and Joanna Ossinger. “Singapore Has Grand Ambitions to Become a Global Crypto Hub”. Bloomberg. 2 November 2021

[10] For details of the considerations to determine whether an offer, invitation or advertisement has been made or issues to the public or any section of the public for purposes of the Payment Services Act, see Regulation 11 of the Payment Services Regulations 2019.

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