The ‘Singapore Collapse’ Went Viral: Here’s What’s Actually Happening

Chinese-language social media has been buzzing with predictions of Singapores decline. Posts claim that luxury brands are fleeing Marina Bay Sands, and that Orchard Roads Christmas decorations looked sparse this holiday season. Some mockingly call Singapore 洗钱坡 (Xǐqinpō, money laundering slope)a sardonic play on the city-states Mandarin name 新加坡 (Xīnjiāpō)forecasting the collapse of a city abandoned by speculative capital. But the data tells a different story. According to Euromonitor International, Singapores luxury market is projected to grow 7-9% in 2025, reaching S$13.9 billionoutpacing Japan, China, and South Korea. This isnt a collapse. Its restructuring. Understanding this transformation requires going back to 2019. From Hong Kong to Singapore: The Great Migration of 2019 When Hong Kongs anti-extradition bill protests intensified in 2019, the geography of Asian finance began to shift. People used to say, The real concern here is that people are moving their companies and their money in greater numbers to Singapore. Back then, 23% of companies with offices in Hong Kong were considering relocating business functions, with nine out of ten choosing Singapore as their preferred destination. When Hong Kongs National Security Law took effect in June 2020, the exodus accelerated. Hong Kongs strict zero-COVID policies during the pandemic further drove financial talent and businesses toward Singapore. Assets managed by Singapores asset management industry doubled in just 6 years to approximately $4 trillion, with 80% of that coming from abroad. Global asset managers like BlackRock expanded their Singapore operations, while Ontario Teachers Pension Plan shut down its entire equity team in Hong Kong. The Anti-Corruption Campaign and Chinese Capital Flight Another engine drove capital into Singapore: Xi Jinpings anti-corruption campaign, launched after his 2012 ascensionthe most extensive in Chinese Communist Party history. Under the banner of catching tigers and flies alike, more than 4.7 million officials have been disciplined since 2012, including 553 at ministerial rank or above. Operations Sky Net and Fox Hunt pursued fugitives across 90 countries and recovered billions in offshore assets. According to Germanys Mercator Institute for China Studies (MERICS), Since 2015, the specter of capital flight has been haunting the Chinese economy. Faced with the threat of currency devaluation and an aggressive anti-corruption campaign, investors and savers began moving their wealth out of China. The outflow was so large that the central bank was forced to spend more than $1 trillion of its foreign exchange reserves to defend the exchange rate. Much of this money flowed into Singapore. The city-states family offices surged from 400 in 2020 to 1,100 by the end of 2022. The nickname 洗钱坡 (money laundering slope) emerged from this context. The Battle for Asias Crypto Hub Money laundering demand intersected with the cryptocurrency industry. Following Chinas 2017 ICO restrictions and 2021 outright ban, major Chinese exchangesincluding Binance, Huobi, Bybit, and OKXrelocated en masse to Singapore. Ethereum co-founder Vitalik Buterin observed that Singapore is becoming the center of crypto communities. Why Singapore? Because it was the only viable answer in Asia. Japan had already learned painful lessons. In 2014, Tokyo-based Mt. Goxthen handling over 70% of global Bitcoin transactionscollapsed after hackers stole approximately $500 million worth of Bitcoin. Japans Financial Services Agency (JFSA) responded by introducing the worlds first registration system for cryptocurrency exchanges in 2016. When another Japanese crypto exchange, Coincheck, lost $534 million in NEM tokens in January 2018, regulations tightened further. South Korea went through its own reckoning. The 2017 crypto boom brought a flood of speculative demand, creating the notorious kimchi premiumwhere Bitcoin prices in Korea traded significantly higher than global markets. Authorities responded with tightened regulations, a stance further reinforced by FATFs 2019 Travel Rule recommendations requiring the sharing of customer information for transactions above certain thresholds. Singapore took a different approach. While it introduced the Payment Services Act (PSA) in 2019, the framework remained relatively flexible. Foreign crypto firms were granted regulatory exemptions allowing them to operate temporarily without licenses, provided they didnt serve Singapore retail investors. The industry consensus became: If you want to do blockchain business in Asia, Singapore is the place. Token2049, Asias largest blockchain conference, relocated from Hong Kong to Singapore in 2022, driven by Hong Kongs zero-COVID policies and regulatory risks in China. Attendance surged from 7,000 in 2022 to 20,000 in 2024, reaching a record-breaking 25,000 in 2025. The Turning Point: Terra-Luna, FTX, and the Fujian Gang But 2022 marked a turning point for Singapore as well. The Terra-Luna collapse in May, the FTX bankruptcy in Novemberboth had Singapore connections. Singapore-headquartered Three Arrows Capital (3AC) also went bankrupt. In 2023 came the $2.3 billion Fujian Gang money laundering scandal: ten individuals from Chinas Fujian province who had entered Singapore using forged identities to launder proceeds from illegal gambling and cyber fraud. The Monetary Authority of Singapore (MAS) shifted its stance. The Digital Token Service Provider (DTSP) licensing regime, which took effect on June 30, 2025, requires all Singapore-based firms serving overseas crypto customers to obtain licenses. There was no transition period. Bitget and Bybit relocated staff to Dubai and Hong Kong, putting hundreds of Singapore-based jobs at risk. A Hong Kong politician publicly stated that Singapore firms are welcome to relocate to Hong Kong. As of late 2025, around 35 companies hold Major Payment Institution (MPI) licenses, including Coinbase, Crypto.com, Circle, and Upbit. The Luxury Market: Who Left, Who Stayed The crypto industrys transformation and luxury market restructuring share the same underlying logic. According to Henley Partners, millionaire inflows to Singapore dropped 54%from 3,500 in 2024 to 1,600 in 2025. Chinese family office applications fell 50% from their 2022 peak. Non-PR foreign buyers accounted for just 1% of private property transactions in Q1 2024, down from 6.4% a year earliera direct result of the Additional Buyers Stamp Duty (ABSD) hike to 60%. But the full picture differs. Singapores luxury market grew 7-9% in 2025, according to Euromonitor projections. The secret lies in the city-states 242,400 resident millionaires. Singapores median household income has risen for five consecutive years. Local wealth is filling the gap left by foreign big spenders. The property market tells the same story. Foreign ownership in the Core Central Region (CCR) has fallen to a 17-year low, with locals now accounting for two-thirds of prime transactions. The price gap between CCR and other regions has narrowed to 4-6%the smallest since 2000. The viral claim that luxury brands fled Marina Bay Sands is also false. In July 2025, Chanel opened a 900-square-meter temporary boutique at MBS while its flagship store undergoes renovation for a 2027 grand reopeninghardly the behavior of a brand in retreat. Also, the 2025 Christmas season featured nightly shows between the Gucci and Chanel stores. Strategic Reset, Not Collapse Whats happening in Singapore may be better understood as strategic de-risking rather than collapse, some observers suggest. The pattern can be seen across sectors: a shift from foreign speculative capital to domestic wealth base, from unlicensed crypto operators to licensed institutional players, from property speculation to sustainable local ownership. Singapores government, having absorbed the lessons of the Fujian scandal and FTX collapse, appears to have prioritized long-term stability over short-term growth. The Singapore collapse narrative on Chinese-language social media arguably amplifies negative signalssuch as the millionaire exodus and crypto industry departureswhile underweighting positive data, such as luxury sales growth and an expanding domestic wealth base. One X users comment may come closer to reality: 消费转级, 不是消费降级consumption restructuring, not consumption decline. Singapore, it can be said, isnt collapsing. Its cleaning house.