Singapore Prime Minister Lee Hsien Loong and Deputy Prime Minister Lawrence Wong face pressure from parliament over their involvement with FTX.
Singapore’s Prime Minister Lee Hsien Loong and Deputy Prime Minister Lawrence Wong are facing pressure from parliament over their involvement with FTX.
The opposition, led by the Workers’ Party, is conducting intense scrutiny over the government’s participation in the stock market, which filed for bankruptcy earlier this month. According to Bloomberg, several questions were raised about the investments that Temasek Holdings, a state investment company in Singapore, made in FTX.
At the core is the completed due diligence process, which would have given the green light for investments. In addition, various inquiries are underway regarding the government’s stance towards the crypto market in general.
Singapore and FTX
Temasek is estimated to have invested $210 million in FTX, giving it a 1% minority stake. In addition, another 65 million dollars were invested in the affiliate of the stock exchange in the United States, FTX US. This occurred in two funding rounds, conducted between October 2021 and January 2022.
The state-owned company claims that the due diligence process on FTX took place between February and October 2021, and included extensive reviews and audits of the exchange’s financials.
Following the FTX downfall, Temasek admitted that “our belief in the actions, judgment, and leadership of Sam Bankman-Fried, formed from our interactions with him and the opinions expressed in our conversations with others, appear to have been out of place.”
Last weekend, former Temasek CEO Ho Ching said that some investments the company made during her tenure were made against her will, further raising suspicions about the local government.
Ho Ching has not yet spared criticism of SBF, saying that “a loss in what could become a poorly run company without adult supervision is egg on our face.”
Is regulatory pressure in sight?
The fall of the SBF empire has been reflected throughout the market, causing other crypto companies to experience difficulties, or file for bankruptcy as well. Now, it could damage the political situation in Singapore.
Although Temasek’s investments in the FTX group represent just 0.09% of his $293 billion fund, they will provide ammunition for the opposition, a stain the current Loong government will have to deal with.
In addition, it is possible that the Asian country adopts a greater crackdown on the entire crypto industry. Despite being the first country to license tokens for an exchange, Singapore has not been as open to the cryptocurrency market.
Binance, for example, has already been on the watch list of local regulators. Also, the country has been associated with Do Kwon. Many believe that the fugitive creator of Earth (LUNA) is hiding in Singapore.
By Audy Castaneda
