SINGAPORE - Ahead of Budget 2024, Web3 and digital asset firms here say they hope for help to grow the sector’s talent pool, lower barriers for blockchain adoption and build up Singapore’s defences against cyber threats and crypto crime.
Some players based in Singapore counted the lack of skills as a key impediment to growing the sector.
They said it is vital to reskill or upskill developers so that they have the abilities needed in Web3, which is the next iteration of the Internet that is decentralised and uses blockchain technology.
To cement Singapore’s position as a hub for innovative blockchain projects, Dr Danny Lim, who is a core contributor at decentralised exchange MarginX, said the Budget should support Web2 developers as they transition into the Web3 sector, especially those facing retrenchment or seeking new career paths.
Web2 refers to the current Internet that is dominated by tech giants like Google and Facebook. It has moved from the previous basic and static webpages to user-generated content, including the growth of social media.
Dr Lim added that targeted incentives and educational programmes through platforms like SkillsFuture Singapore would promote a thriving blockchain community.
Others like Ms Elaine Zhu, general manager at Parity Asia, a firm that incentivises developers to build on the Polkadot network, hopes to see further investment in blockchain education.
Citing a recent Electric Capital report that quantifies developer activity across Web3, she said the number of experienced developers here remains healthy, but the number of newly qualified developers fell by 52 per cent in 2023.
Ms Zhu added that incentives for digital assets and Web3 projects that are keen to explore greener blockchain initiatives would be helpful for firms’ sustainability journey.
Mr Liu Yusho, chief executive and co-founder of exchange Coinhako, is hoping for more resources for government agencies that go towards helping crypto and Web3 companies setting up in Singapore fit better with the ecosystem here, be it through education on compliance or collaborations.
He said that smaller firms face several headwinds, including high inflation that adds to overheads, and the higher goods and services tax that eats into their profit margins and adds price pressures.
“More relief for start-ups and small and medium-sized enterprises can help pave Singapore’s trajectory towards being a regional tech hub, amidst inflationary pressures and growing tax contributions,” Mr Liu said.
Mr Nikhil Joshi, chief operating officer at blockchain technology firm Emurgo, which is a founding entity of the Cardano blockchain, said he hopes the Government can unveil measures that would lower the barriers for institutions and businesses to explore Web3 and blockchain solutions.
He said this ensures industries evolve alongside up-and-coming innovative technologies.
Officials could provide incentives and opportunities for institutional players to be experimental with new forms of innovative technologies, beyond initiatives such as Project Guardian, said Mr Joshi.
Project Guardian, launched in May 2022 by the Monetary Authority of Singapore (MAS), aims to explore the use of public blockchains to build open and interoperable networks that would enable digital assets to be traded across platforms and liquidity pools.
Mr Joshi also suggested that the Government consider adjusting the regulatory capital framework to reward financial institutions that improve their operational risks through the use of better technology, and to encourage experimentation with innovative technologies that serve to enhance trust and transparency.
He said that there is a need to improve people’s understanding that the use of a public blockchain is not limited to cryptocurrency speculation, but that it is a useful tool for all sectors.
The technology is already being put to use in various sectors. For instance, there is OpenCerts, a blockchain platform that offers an easy and reliable way for schools to issue and validate tamper-resistant digital academic certificates to students.
For some, building up Singapore’s defences against cyber crime is also key.
Ms Ong Chengyi, head of policy for Asia-Pacific at blockchain research firm Chainalysis, said Web3 is a long-term growth driver.
So, she hopes to see continued government support for companies in the sector to develop capabilities and equip themselves with technology-based risk management solutions.
Ms Ong said this would build on the helpful grants already launched by MAS to drive regulatory technology adoption.
Criminals have continued to abuse digital assets for illicit purposes, including ransomware, sanction evasion and money laundering. “We hope to see more public-private collaboration to build Singapore’s defences against crypto crime, and cyber threats more generally, through the use of data and technology,” said Ms Ong.
Ms Angela Ang, senior policy adviser for blockchain intelligence firm TRM Labs, said one item on her wish list is to enable digital asset growth by boosting regulatory resourcing.
“In a world where digital asset businesses are hungry for regulatory clarity, Singapore’s clear framework has positioned us as an attractive hub. To deliver clarity to businesses at scale, whether it’s through licensing decisions or implementation guidance, the Government must invest in both human capital and technology throughout the regulatory process,” she said.
The Singapore 2024 Budget Statement will be delivered on Feb 16 by Deputy Prime Minister and Minister for Finance Lawrence Wong.
