Singapore Reverses Course on Stablecoins, Now Open to Cross-Border Issuers
The Monetary Authority of Singapore is reconsidering its domestic-only stablecoin framework and proposing new rules that would allow jointly-issued and select foreign-regulated stablecoins to operate under its regulatory umbrella.
Regulatory Framework Expansion
Singapore’s financial regulator is shifting its stablecoin stance after reconsidering restrictions it imposed three years ago. According to the Monetary Authority of Singapore (MAS), as reported by Cointelegraph, the authority launched a public consultation this week on amendments to its regulatory framework. The new proposals would permit stablecoins jointly issued by Singapore and overseas entities to qualify for regulation under MAS oversight, provided adequate risk mitigation measures are in place. Additionally, MAS is exploring the possibility of recognizing a limited set of foreign-issued stablecoins that meet comparable regulatory standards in their home jurisdictions, particularly for use in cross-border wholesale transactions between financial institutions.
From Domestic-Only to International Recognition
When MAS established its original stablecoin framework in 2023, the authority restricted eligibility to single-currency tokens issued solely within Singapore and pegged to either the Singapore dollar or currencies from the Group of Ten. That decision reflected MAS’s concerns at the time about regulatory coordination challenges across jurisdictions. The authority noted technical obstacles in tracking the origins of commingled stablecoins and verifying that overseas reserve holdings would suffice to meet customer redemption demands.
The latest consultation signals a willingness to address those earlier concerns through updated oversight mechanisms and risk controls. Proposed regulatory amendments would be integrated into Singapore’s Payment Services Act, the foundational legislation governing payment service operators. Requirements under the expanded framework include ensuring reserves backing stablecoins, maintaining sufficient capital, permitting redemption at face value, and mandating full issuer disclosure to regulators and customers.
Operational Requirements and Market Access
Under the proposed rules, only MAS-licensed entities would be permitted to market their tokens as “MAS-regulated stablecoins.” MAS is also considering restrictions on issuer behavior, including prohibiting interest payments on regulated stablecoin holdings. The framework would require stress testing capabilities, documented plans for orderly unwinding, and safeguards protecting customer deposits prior to stablecoin issuance. Stablecoins operating outside this licensed framework would remain classified as digital payment tokens subject to existing regulations. The public comment period extends through October 16, 2026.
This shift toward openness positions Singapore as a more flexible jurisdiction for stablecoin operators while maintaining oversight standards. Clearer pathways for cross-border stablecoin activity could strengthen the region’s role as a crypto and fintech hub, supporting infrastructure development for tokenized transactions and payments.
Source: Monetary Authority of Singapore, via Cointelegraph. Not financial advice.