Singapore continues to find crypto gold as fintech investment hits $4.1 billion

Fintech investment in Singapore has climbed to a three-year high, with cryptocurrency and blockchain still capturing top dollar.

Investments for the sector grew by 22% to $4.1 billion last year, securing 250 deals in M&A, private equity and venture capital. The figure was the second highest fintech investment in the past decade, with investments peaking at $5.62 billion in 2019, just before the global pandemic hit, according to the latest KPMG Pulse of Fintech report.

Globally, fintech investment reached $164.1 billion across 6,006 deals last year, down from a record $238.9 billion from 7,321 deals in 2021. The top three investment areas in 2022 were payments, followed by crypto and blockchain, and regtech (regulatory technology).

In Singapore, funds were allocated to the top three areas of crypto and blockchain, payments and wealth technology. Blockchain and crypto saw high investment interest the previous year in 2021, when the category brought in almost half of the total funds, raising $1.48 billion across 82 deals.

Across the Asia-Pacific region, fintech investment saw a slight increase to $50.5 billion in 2022, up from $50.2 billion in 2021. Specifically, the second half of 2022 saw just $5.8 billion in fintech investment, compared with 44.6 billion dollars in the first half of the year.

The KPMG report pointed to Block’s $27.9 billion acquisition of Australian buy now, pay later provider Afterpay, which accounted for more than half of its regional investments. The acquisition pushed Australia to the front of the pack in the Asia-Pacific, receiving $20.2 billion in fintech investment.

India’s $6 billion investment, alongside Singapore’s $4.1 billion, dwarfed China’s fintech investment pool, which reached just $770 million.

The Americas remained the leading region for fintech investment, accounting for $68.6 billion last year, with the US accounting for the bulk of $61.6 billion. The EMEA region recorded $44.9 billion in fintech investments.

Across the globe, payments took the largest share of fintech funds, while regtech saw the highest growth reaching $18.6 billion in 2022, up from $11.8 billion the previous year.

Singapore’s state-owned investment firm Temasek Holdings said last November it would write down its investment in troubled cryptocurrency exchange FTX, saying faith in disgraced founder Sam Bankman-Fried was “misplaced”. Temasek had participated in two financing rounds, totaling 275 million dollars in investment.

Local bank DBS said earlier this week that it recorded an 80% year-on-year growth in the number of Bitcoins traded last year on the DBS Digital Exchange. The number of Bitcoins deposited with the bank’s digital asset custody platform also doubled, it added.

The number of Ether traded on the exchange rose almost 65% in 2022, while the amount of the cryptograph deposited with DBS grew by more than 60%.

The bank in Singapore has just under 1,200 customers registered on the digital exchange, as of 31 December 2022.

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