Singapore weighs wider access for foreign stablecoins under tighter rules
MAS has proposed routes for joint issuance and recognition of overseas stablecoins, while several requirements remain unresolved.
The Monetary Authority of Singapore (MAS) is considering expanding access for foreign stablecoins while tightening requirements for issuers. Its proposals, put forward on 1 September, would allow stablecoins issued jointly by Singaporean and overseas companies to qualify for its regulated framework.
Another proposed route would recognise some stablecoins licensed abroad, provided MAS has a cooperation agreement with the relevant overseas regulator. MAS said it would review cross-border issuance arrangements individually and require safeguards.
Claudia Hui, Asia-Pacific head of compliance advisory at TRM Labs, said the tighter requirements include quarterly stress tests, recovery and wind-down plans, and a prohibition on interest payments to holders. Issuers would also have to identify stablecoins connected to illegal activity, freeze them and remove them.
Banks would have to create separate nonbank companies to issue stablecoins under the framework, according to Reed Smith partner Etelka Bogardi. She said this could deter banks from participating. Hui said international issuers might pursue recognition or joint issuance instead of seeking standalone Singapore licences.
Questions remain over minimum cash reserves, issuance limits and the treatment of stablecoins offered in Singapore outside MAS regulation. Bogardi said uncertainty about whether reserve-asset returns could cover operating costs might influence issuer fees. Singapore's Payment Services Act of 2019 may also require amendments.
