(Daily News) Coinbase Business Goes Global With Singapore Expansion—Strengthening USDC’s Adoption Across Asian Fintech Hubs

As part of Coinbase’s “Go Broader & Go Deeper” strategy, the company is taking its business-oriented platform, Coinbase Business, beyond the shores of the United States by launching a new subsidiary in Singapore. As the U.S. crypto exchange goes global, it strategically chose Singapore, perhaps due to the country’s progressive stance on digital assets.

Announcement of Coinbase Business official Singapore launch. Source: Coinbase Singapore Official X Account

Already, Coinbase has an established presence in the city-state after securing a Major Payment Institution (MPI) license from the Monetary Authority of Singapore (MAS) in 2023 and launching a tech hub in 2024 to support engineering, compliance, and its regional operations.

This new subsidiary is expected to solidify Coinbase’s presence in Asia as well as provide start-ups and SMEs with a unified platform for USDC payments and asset management.

New Dawn for Businesses Amid Coinbase’s Singapore Launch

Coinbase Business is now available to Startups and SMEs in Singapore. According to the company, the platform allows businesses to send and receive payments in USD coin (“USDC”), access global payouts, trade digital assets, and automate financial workflows using a single crypto-native account.

Also, this launch, supported by a strategic partnership with Standard Chartered Bank in Singapore, enables real-time Singapore-dollar (SGD) transfers and on-ramp/off-ramp crypto.

Additionally, businesses can generate payment links for global customers with transaction fees around 1% (which is less than most credit-card processors). It supports on-chain settlements and treasury management through USDC holdings, as well as integration with popular accounting platforms like QuickBooks and Xero.

Contrary to previous claims that the rise of stablecoins could undermine the U.S dollar, Coinbase’s expansion further reinforces its rebuttal that demand for stablecoins is peculiar to international users only.

Singapore Takes the Crown for New Crypto Projects

Singapore is slowly becoming a prime destination for Crypto Businesses such as Coinbase. Its clear and friendly regulatory framework, combined with a supportive business environment, has made it an attractive launchpad for digital asset projects. Over the past three years, Singapore has doubled down on its commitment to blockchain innovation, including offering grants and tax reliefs to expand the scope of existing operations.

Today, the country is home to hundreds of crypto payments startups and numerous blockchain labs. The latest project, being Coinbase Business, aligns with the country’s policy on harmonizing traditional finance and digital asset banking.

Earlier in 2023, the Monetary Authority of Singapore (MAS) announced granting over 30 licenses to digital asset providers (including Circle, Coinbase, Crypto.com, and Gemini) under the Payment Service Act (PSA), 2019. Similarly, traditional financial institutions are also making significant moves into the crypto space.

DBS Bank has launched its own institutional crypto trading platforms, while other projects, such as the stablecoin XSGD (pegged against the Singapore dollar) and OKX’s stablecoin payment integration with GrabPay Merchants, have deepened Singapore’s role as a testbed for real-world crypto utility.

Potential Risks and Regulatory Hurdles

Currently, Coinbase Business’s operations in Asia are anchored in Singapore, though the company has signaled ambitions to serve clients across the region. This regional expansion, however, may expose the exchange to multiple regulatory regimes.

Also, Coinbase is only licensed with the Monetary Authority of Singapore (MAS) within the Asian market. We expect that it will come under additional obligations if it eventually extends operations to other regions.

Additionally, global oversight of stablecoins is intensifying as the growing competition in the space intensifies. Any significant alteration in the existing landscape may disrupt Coinbase’s global payments offering.

What’s Next for Coinbase?

At press time, Coinbase Global Inc. (COIN) is trading near $304.01, per CoinMarketCap. This reflects a modest decline of approximately 4.44% from the previous close. Analysts note that the market has yet to fully price in the impact of Coinbase’s latest business expansion.

Following the release of its Q3 results, market reactions were mixed even though many acknowledged that the company’s expanded product offerings likely contributed to its robust earnings. In response, some analysts like Barclays’ Benjamin Budish lowered his price target to 357% from $361, while others like Owen Lau were optimistic and pushed their target over $400. They cited strategic partnerships and cross-border operations as growth drivers.

We concur that the new launch will support Coinbase’s long-term prospects beyond trading revenue. Two reasons: one is that the future of crypto lies in mainstream adoption, particularly digital asset banking, and crypto-to-fiat and fiat-to-crypto on-ramps.

Also, in the past, similar news such as Coinbase securing a license from MAS, scaling regulatory hurdles have sent its stock price to the moon. Likewise, more activities are expected to occur on the exchange, coupled with the strengthening of the USDC utility in the wake of SMEs adopting crypto payments for businesses.

Conclusion

The launch of Coinbase Business in Singapore reinforces its commitment to global expansion and blockchain innovation. Its decision to start operations from Singapore signals the relevance of a friendly regulatory and business environment.

In the past three to five years, Singapore has worked diligently to position itself at the forefront of the next wave of blockchain innovation. It has achieved this by creating a grants fund, offering tax reliefs, and providing a clear and stable regulatory regime.

However, Coinbase’s move is not without risk. Its plan to take over the Asia market with digital asset banking products may be altered by global controls and diverse regulatory requirements. Also, this launch reflects a broader shift from cryptocurrency trading to mainstream adoption. Exchanges and crypto innovators like DigiTap are seeking new revenue streams by creating practical utility for cryptocurrencies.

Finally, there are mixed feelings about the potential impacts of this launch on Coinbase’s profitability and, by implication, stock performance. The scale tilts in a positive direction. This is because Asia is a growing market, and the adoption of stablecoins for international trade is on the rise.