1. What is blockchain gaming?
A blockchain game is a video game that contains aspects that leverage blockchain technology based on encryption. Blockchain components in these games are often centered on the usage of cryptocurrencies or non-fungible tokens (NFTs) that players may purchase, sell, or trade with other players. This is a significant innovation for players who previously accepted that their items would be stuck in the game forever. If in traditional games – where all data, assets and in-game currency are usually confined to that game, blockchain gaming shows a decentralized gaming future: where items won or purchased in one game can be transferred and used in another, placing real-world value into in-game digital assets.
More players than ever are getting their gaming fix via decentralized ledger technology, and the introduction of play-to-earn (P2E) gaming has turned blockchain games into a profitable alternative for players eager to fill their crypto bags while putting their abilities to the test.
The explosion of crypto/blockchain gaming with many games such as The Sandbox, Decentraland, CryptoKitties, etc... especially the game Axie Infinity (developed by Sky Mavis - a game company founded in Singapore) are "storming" in many areas of the world. Playing games for money based on blockchain technology like Axie Infinity is becoming the focus of discussion among gamers recently.
2. Top benefits to opening a blockchain game in Singapore
Crypto/blockchain gaming has been hailed as a new direction for the game industry but has failed to deliver results because the operating environment is not really ideal for crypto/blockchain gaming. Despite lacking many professional gamers and blockchain-focused development companies from a rather niche market, many crypto/blockchain gaming start-ups have gone overseas to countries like Singapore that have bet big on this booming industry.
2.1 More opportunities to receive foreign investment for Singapore blockchain gaming company
Blockchain/crypto gaming, with its capacity to convert players into investors, not only draws a great number of players but also a significant number of investors interested in this new trend. In an InvestGaming report for the first six months of 2021, 24 companies with ties to cryptocurrencies and blockchains raised $476 million across 24 deals - which is more than double the amount from last year's twelve 121 USD million deals.
The development phase of blockchain/crypto gaming has only just begun and could be further amplified if blockchain/crypto gaming businesses set up companies in Singapore.
Singapore has become a hotbed when it comes to FDI capital and attracting tech-based companies - especially cryptocurrency and blockchain-based gaming startups. More specifically, in 2020, Singapore recorded a 15% increase in FDI capital to $92 billion - this is the highest level of investment in the history of the lion island nation. In which, two Singaporean technology and software development companies, Grab and Bigo Technology, have successfully called for investment capital when:
- Grab received $1.5 billion from Softbank (Japan) with an undisclosed stake. This transaction partly helps Grab complete its intention to list on Nasdaq under the symbol GRAB, once the transaction is completed.
- Bigo technology received $1.4 billion from YY Inc (China) with a stake of 68%.
2.2 More tax optimization opportunities for Singapore blockchain gaming company
In the worldwide business world, establishing a company in a foreign country such as Singapore, Hong Kong, or others to enable investment for local companies is no longer a novel notion. With a crypto/blockchain gaming company in Singapore, businesses:
- can easily attract investment capital from major investors in the world,
- can create a sandbox to test new technology applications/new business models in the country.
The solution for starting a company in Singapore has aided blockchain gaming firms in attracting foreign investment while also developing their brand domestically and globally. As more crypto/blockchain gaming companies figure out they can do business in Singapore, they can take advantage of the friendly tax laws and do business with other related countries like G7 countries who also have tax treaties with Singapore.
2.3 More opportunities to join the ecosystem of enterprises - SMEs - blockchain application startups in Singapore
In Singapore, blockchain is not only being used in the gaming market but also in many different fields, such as:
- Blockchain application in the field of Communication: Top Network, etc.
- Blockchain application in the field of Digital Content: MinersINC, REOS, etc.
- Blockchain application in the field of games: Sky Mavis, ALTO, Seascape, etc.
In addition, Singapore is also home to the regional headquarters of many blockchain application companies around the world such as:
- Wachsman: The company is headquartered in New York and recently opened its Asia Pacific headquarters in Singapore. It is a company that provides public relations, event management and strategic consulting services to several companies (Sea, Singlife, etc.) and the most important project in the blockchain ecosystem.
- Bluzelle: The company is headquartered in Silicon valley (USA) and chose Singapore to establish its blockchain company in 2014. The company provides a complete solution and fully integrated blockchain applications, middleware and data services for its customers.
2.4 More benefits with projects from Singapore Government to encourage and promote the development of blockchain
The relentless growth of blockchain technology is partly due to the policies of the Singapore government:
- Since 2016: The Monetary Authority of Singapore (MAS) has cooperated with R3 - a blockchain technology company and cooperated with financial institutions to develop an interbank payment project using blockchain technology. Singapore is also exploring the use of blockchain to link National Trade Platforms with other countries' commerce platforms.
- In 2020: The Singapore government launched an SGD 12 million blockchain innovation program to translate blockchain technology research into commercial applications. Funded by the National Research Foundation (NRF), the program will work with 75 companies, including multinational corporations, large enterprises and information technology companies, to brainstorm ideas for 17 blockchain-related projects within the next three years.
2.5 More benefits with the clear legal policies on blockchain and cryptocurrency in Singapore
2017 was an important year for Singapore's crypto sector as the MAS has begun reviewing the implementation of legislation regulating the issuance and use of virtual currencies. MAS is also considering creating a regulatory framework for those interested in setting up cryptocurrency funds for Initial Coin Offerings (ICOs).
At the same time, Singapore is one of the few countries in the world that has a Blockchain and Cryptocurrency Industry Association dedicated to small and medium enterprises (SMEs) working in this field - ACCESS - Association of Crypto Currency Enterprises and Start-ups Singapore. The organization introduced the Act for crypto-related businesses in the country in partnership with MAS and the Association of Banks in Singapore (ABS). This is to standardize principles to help digital asset traders/owners increase regulatory compliance.
2.6 More benefits with many incentives for start-ups established in Singapore
Singapore has one of the best corporate tax rates in the world. The corporate income tax rate in Singapore is 17% on company profits. However, the government has certain tax incentives for start-ups according to the following profit levels:
- The first $100,000 of normal chargeable income is exempted at 75%, lowering the effective tax rate to 4.25% on the first 100,000 SGD of chargeable income; and
- The next $100,000 of normal chargeable income is exempted at 50%, lowering the effective tax rate to 8.5% on the next 100,000 SGD of chargeable income.
This policy applies to businesses in the first 3 years from the date of establishment. After 3 years, there will still be tax incentives but at a lower rate. The government also regularly launches packages to support businesses and stimulate the economy, so the actual tax rate can be even lower. Blockchain game companies interested in setting up a company in Singapore can estimate the amount of tax payable to the Singapore government in this tax calculator.
In addition, Singapore also has a Partial Tax Exemption (PTE) program that applies to all companies in Singapore that are not beneficiaries of the tax exemption program for startups. After the Startup Tax Exemption Program ends, the company can still apply to continue receiving a Partial Tax Exemption (PTE) from year 4 onwards.
3. Requirements to open a blockchain gaming company in Singapore
The process of opening a blockchain gaming company in Singapore is similar to the process of setting up any other Singaporean company. Types of companies that can be incorporated in Singapore are Sole Proprietorship, Partnership, Private Limited Liability Company (Pte. Ltd.), Limited Liability Partnership or Limited Partnership. Requirements to open a blockchain gaming company in Singapore will include:
- Minimum initial upfront capital is 1 SGD
- At least one shareholder. This shareholder can be an individual or a company.
- At least one local director. This director must be a permanent resident or citizen of Singapore.
- At least one secretary for the Singapore company. This secretary must also be a permanent resident or citizen of Singapore.
- A physical address of the Singapore company. This address can be in a commercial or residential area.
- A corporate bank account in Singapore
4. What to do after opening a Singapore company?
According to the Singapore Companies Act promulgated by ACRA, Singapore companies must prepare the following types of reports:
- Estimated taxable revenue report
- Corporate income tax return (Form C/C-S)
- Minutes of the Annual General Meeting (AGM)
- Annual Report (AR)
5. Why should open a blockchain game company in Singapore with support from us?
As an expert consulting unit, Global Link Asia Consulting is the ideal company with plenty of experience in opening businesses all over the world, especially businesses seeking to open companies in Singapore and abroad. One of the biggest draws for our consultancy service is that we can help your business operate more smoothly:
- Support for setting up a company in Singapore quickly: With a team of consultants in Singapore, the process of opening a company can be significantly accelerated without having to be in Singapore.
- Support for opening corporate bank accounts in Singapore: Opening a corporate bank account for our business is an important and often difficult step.
The search for a bank may be a long and drawn-out one because there are so many different factors to consider, especially if it's for a technology startup or for your game development project.
Banks in Singapore ask that businesses submit a myriad of documents and information in order to be approved for account funding.
→ Global Link Asia Consulting provides a means of assistance throughout the process by not only helping organize the information needed to secure accounts, but also helping diversify the methods of assistance offered by consulting businessmen for their next corporate bank account interviews.
- Support in making financial statements for companies in Singapore: This is a compulsory requirement to operate a Singaporean company in the long term, but companies that cannot abide by this law will not be able to operate. Singapore has strict accounting and reporting standards that differ from many developing countries. Therefore, Global Link Asia Consulting helps such businesses with its expert accountants who are knowledgeable in tax law - Singaporean accountants - giving such businesses complete and accurate financial statements to send to the Singapore government.
- Consult tax optimization for Singapore - Vietnam business model: With a wealth of experience in providing business and technical consulting services to software, app development, game development, digital media, advertising and marketing companies, Global Link Asia Consulting not only offer solutions but also support our clients along their way towards success by supplying them with tools and techniques for optimal business model management.
6. Frequently asked questions when opening a blockchain gaming company in Singapore
6.1 Why should you open a crypto/blockchain gaming company in Singapore?
Because crypto/blockchain gaming companies will have the opportunity to take advantage of the blockchain ecosystem when doing business in Singapore, including: a developed blockchain technology platform, the opportunity to attract large investors; an open market for crypto/blockchain games players; opportunities to optimize corporate income tax (CIT) and take advantage of Singapore's blockchain development policy.
6.2 What can we do to support your business?
Not only supporting crypto/blockchain gaming companies to set up companies in Singapore, but we also advise on optimizing business models for Singapore companies and foreign companies to utilize human resources and optimize taxes (CIT) effectively, saving business operating costs and supporting businesses to operate a legal and long-term Singapore company.
Global Links Asia Consulting Company - a consulting firm specializing in offering ONE-STOP solutions for every business at every level of your business development - is ready to support your business with the following services:
- Overseas incorporation consultancy services (especially in Singapore, Hong Kong (China), the USA, BVI, Seychelles, etc.)
- Opening bank accounts consultancy services in Singapore (for Personal and Business Account)
- Tax - Accounting consultancy services (in Singapore, Hong Kong (China), etc.)
- QuickBooks Online consultancy services (Training and Licensing)
- Register international phone transfer in Singapore, the United States, EU, etc.
- Payment solutions consultancy services (support to open PayPal Business account, register for PayPal Pro, etc.)
With our one-stop solutions, we pride ourselves on being a trustworthy partner - working directly with major notable banks such as OCBC, DBS, UOB, Standard Charter Bank, ANZ, etc and international payment gateways such as PayPal and many other partners. With many years of experience working in this industry and having supported many companies, Global Link Asia Consulting are confident to bring the best quality of our services to all clients.
Contact us now:
- Vietnamese Hotline: (+84) 0938 531 588 (Call/ Skype)
- Singaporean Hotline: (+65) 3163 4102 (Call)
This article was written by Global Link Asia Consulting Pte. Ltd. and was first published on https://www.globallinkconsulting.sg/ on 27th December 2021. Its copyright belongs to Global Link Asia Consulting Pte. Ltd. All rights reserved. You may not, except with our express written permission, copy, modify, commercially distribute or exploit the content.