Financial Institutions in Singapore Slapped with a Fine of SGD 22 Million - Shiba Inu's Virtual Counterpart Found to be Less Risky
In the world of cryptocurrencies, illicit funds have been a persistent challenge. However, a promising solution could be on the horizon, as the Shiba Inu cryptocurrency project plans to integrate Fully Homomorphic Encryption (FHE) technology. This innovative technology, which enables the processing of encrypted data without decryption, could significantly advance money laundering detection within the crypto space.
Recently, Singapore's Monetary Authority of Singapore (MAS) imposed a total of S$27.45 million (about US$21 million) in fines on nine financial institutions for breaches of anti-money laundering and countering the financing of terrorism (AML/CFT) regulations. These breaches, which included weaknesses in customer due diligence, transaction monitoring, and failure to follow up on suspicious transaction reports, highlight significant gaps in banks' AML controls [1][2][3].
In contrast, Shiba Inu's approach to crypto AML is more proactive and technologically innovative. Instead of traditional monitoring that requires direct access to raw data, Shiba Inu's use of FHE represents a cutting-edge, privacy-preserving technology designed for decentralized finance. This technology could enable automated AML detection on encrypted blockchain data, enhancing compliance while upholding user confidentiality, a key challenge in crypto AML efforts.
The MAS's enforcement efforts against these financial institutions have now been completed [4]. The breaches were primarily the result of weak or inconsistent execution of AML/CFT measures, despite the majority of institutions having put necessary policies and frameworks in place [5]. The largest fines were issued to the Credit Suisse Singapore Branch, United Overseas Bank Limited (UOB), and UBS AG's Singapore Branch, with fines of approximately US$4.29 million, US$4.14 million, and US$2.22 million respectively [6].
By using FHE, Shiba Inu aims to help regulators and developers detect illicit financial behavior more effectively, while still protecting user confidentiality on-chain. Decentralized applications (dApps) in the Shiba Inu ecosystem could run advanced compliance checks and transaction monitoring without sacrificing privacy, addressing a long-standing challenge in crypto [7].
The Shib Magazine and The Shib Daily are the official media and publications of the Shiba Inu cryptocurrency project, providing updates on its developments and initiatives. If widely adopted, Shiba Inu's FHE-based approach could transform how AML is conducted in decentralized and privacy-sensitive environments, complementing traditional regulatory regimes that rely on transparent data access and reporting.
References: [1] MAS fines S$27.45M on nine banks for AML/CFT breaches over S$3 billion money laundering case, July 2025, TwoBirds. [2] MAS imposes strong penalties on AML failures, including wire transfer lapses, July 2025, Clyde & Co. [3] MAS AML penalties and enforcement actions summary, July 2025, Ocorian. [4] MAS AML enforcement efforts against financial institutions completed, July 2025, MAS. [5] Compliance failures in AML/CFT standards among certain institutions and their personnel, July 2025, MAS. [6] MAS imposes largest fines on Credit Suisse Singapore Branch, UOB, and UBS AG's Singapore Branch, July 2025, MAS. [7] Shiba Inu's FHE technology enables dApps to perform advanced AML checks without compromising user privacy, July 2025, Shiba Inu project announcement.
- The banking-and-insurance industry faced significant fines for AML/CFT breaches, highlighting the need for enhanced regulations and technology.
- Shiba Inu, on the other hand, is approaching crypto AML proactively, integrating FHE technology to enable automated AML detection on encrypted blockchain data.
- The implementation of FHE technology in Shiba Inu could revolutionize AML in decentralized and privacy-sensitive environments, complementing traditional regulatory practices.
