With the value of Bitcoin fluctuating wildly in the past few months, the attention surrounding cryptocurrency – and blockchain technology in general – is stronger than ever. Although uncertainty continues to surround cryptocurrencies, even the most unconvinced sceptic must concede that blockchain technology and its applications could enhance banking, logistics, and other aspects of our socio-economic reality.
Yet, when we think of blockchain start-ups, our mind usually conjures images of sleek, futuristic buildings that are enshrouded within the consecrated enclaves of Silicon Valley. Singapore should not (usually) come to mind.
But it should.
An unExpected nursery for blockchain startups
There are four reasons why blockchain start-ups would find Singapore an attractive base: global visibility, access to funding, conducive infrastructure, and favourable government policies.
- Favourable government policies
An added boon to blockchain start-ups that establish themselves in Singapore is the policies that are favourable to blockchain research. Singapore has aggressively championed blockchain R&D, as evidenced by the $12 million that it recently poured into the Singapore Blockchain Innovation Programme.
Under this tripartite initiative, Singapore plans to engage different stakeholders in the blockchain industry to conceptualize 17 blockchain-related projects by 2023.
As of 2020, Singapore had already established itself as one of the leaders in blockchain research, contributing nearly 28 blockchain-related publications per million resident population. With such heavy funding, this number is likely to increase.
2. Access to funding
Singapore’s advocacy of blockchain technology also reflects a larger nationwide push for tech-based research, with the government allocating nearly $19 billion to technological research in its latest Research Innovation and Enterprise (RIE) plan. Coupled with an open investment regime, where numerous global banks have based themselves in Singapore, Singapore also facilitates the access of start-ups to both private and public investment.
3. Conducive infrastructure
Singapore’s robust IT infrastructure also makes it an ideal starting point for any tech start-up. While it already boasted the fastest fixed broadband globally, it has already invested heavily in the next-generation 5G technology, with IMDA expecting Singapore to fully receive 5G coverage within the next five years.
4. Global visibility
The last factor is often omitted in commentaries about Singapore’s startup ecosystem, but we think it is critical (as if not more important) compared to the others.
Singapore has consistently ranked highly in global indices for innovation, digital competitiveness, and other areas of interest for venture capitalists. Singapore not only dominated in the recent rankings of global financial centres but also ranked first among all Asia-Pacific countries in the Global Innovation Index (GII) – for the seventh year running. What about the ease of doing business? First in Asia, second globally. As for digital competitiveness? It was the exact same story.
To put it in another way, everyone recognizes Singapore as one of the leading financial, investment, and tech hubs in the world. This visibility makes it more likely for any start-up’s activities in Singapore to be noticed by global clients and investors, simply because most of them would be physically in the country or flying en-route through it (before the pandemic at least).
And considering how most blockchain start-ups’ business models are largely B2B, this visibility matters.
Read similar article: Impossible trinity of B2B start-ups
Beyond ASEAN blockchain leadership?
Will these factors translate into (a lot of) successful blockchain startups? Not necessarily. It will still depend on timing, luck, investor sentiment, and of course the hard work of each individual startup.
What we do know is that if your blockchain startup is headquartered in Singapore, your odds are definitely higher.
More blockchain-related projects are in their beta stages, waiting to germinate. Who knows, the next ‘big’ blockchain start-up might be among them.