Tembusu launches 2nd Bitcoin machine
AS TEMBUSU Terminals launched its second Bitcoin vending machine here on Wednesday, the Bitcoin party continued - but some operators are mindful about keeping the music down in the wake of regulatory attention.
A week after the Monetary Authority of Singapore (MAS) said that it would introduce regulations to curb money-laundering and terrorist-financing risks, the Bitcoin community is trying to understand the lay of the land.
Tembusu, for example, already has the technical capability to produce a two-way machine with cash-in and cash-out options - that is, allowing the conversion of Bitcoin into fiat currency and vice versa.
But its machines are one-way ones; they take only cash for Bitcoin, because the venues hosting them do not require the cash-out function, Tembusu said on Wednesday.
Even so, the firm is not in a hurry to introduce two-way machines, given how the rules are being written even as the Bitcoin industry develops at breakneck speed.
Mr Jarrod Luo, one of Tembusu's founders, told The Business Times: "We are still being briefed by our regulatory team and talking to MAS... We don't want to open ourselves up to the possibility of regulatory backlash if we haven't done our research right."
The regulations that MAS proposed last week will oblige Bitcoin exchanges, brokers and machine operators to verify the identities of their customers and report suspicious transactions. These rules are expected to kick in within the next 12 months.
Tembusu's second machine, parked at a business centre called the Eclat Office Club in Mohamed Sultan Road, does not have know-your-customer (KYC) functions installed, though these can be retrofitted, Mr Luo said.
Singapore has seven Bitcoin machines operated by three players, all of them offering only a one-way, cash-in function that allows for fiat currency to be converted into Bitcoin.
For one of the operators, the reticence over having the cash-out function predates the MAS announcement.
Numoni, which has four Bitcoin vending machines here, will not implement the function for now because of the risks involved in accepting Bitcoins for fiat currency, such as the difficulty in determining where a user got his Bitcoin from.
Chief executive Norma Sit said that Numoni will observe the market and keep an eye on MAS' views on the matter.
Bitcoin Exchange owns an ATM at Citylink Mall.
Even so, potential new entrant Coin Republic is set to test these uncharted cash-out waters. The Singapore outfit is bringing in a Bitcoin ATM that has both cash-in and cash-out functions.
The machine was to have been launched on Monday, but a problem cropped up with its barcode scanner, said Coin Republic founder David Moskowitz. A new barcode scanner is on its way and may be here within the week.
Already, some users who previewed the machine are leery of its KYC features, such as the palm-print reader, he said.
The machine will include the cash-out function upon its launch, but the KYC elements will not be turned on until the rules kick in, he added.
Over the coming months, MAS will hold a public consultation that will give operators a better idea of the rules that they have to comply with.
For now, the party will go on, here and elsewhere. On Wednesday, reports said that 400 fully operational Bitcoin ATMs could be rolled out in Dubai over the next two weeks.
In Singapore, all existing machine operators also have plans for more machines.