Singapore’s central bank has proposed a framework that would let it selectively recognise a limited number of foreign-issued stablecoins for cross-border use, alongside a new licence for local issuers and stricter safeguards — but the plan is still a proposal, with the public comment period having just closed and no response or commencement date yet set.
What Happened
The Monetary Authority of Singapore (MAS) published a consultation paper on 1 September 2026 proposing amendments to the Payment Services Act 2019 to implement a framework for MAS-regulated single-currency stablecoins pegged to the Singapore dollar or a G10 currency. Under the proposal, only MAS-licensed issuers could call their coins “MAS-regulated stablecoins”; issuers would face requirements on value stability, capital, redemption at par, and disclosure, plus a ban on paying interest to holders, mandatory stress testing, and recovery and orderly wind-down plans, MAS said.
The paper also proposes recognising a limited number of foreign-issued stablecoins already regulated under a comparable overseas framework, on a case-by-case basis, mainly for cross-border wholesale use, according to MAS and law firm Reed Smith LLP’s reading of the proposal. Recognition would require the foreign issuer’s home regulation to be judged broadly equivalent, a supervisory information-sharing arrangement between MAS and that regulator, limits on permitted activities, and ongoing reporting, Reed Smith said. Separately, stablecoins jointly issued by a Singapore entity and a foreign issuer could also qualify for the “MAS-regulated” label if risks are sufficiently mitigated, MAS said.
The public comment period on the proposal closed on 16 October 2026. Singapore Business Review followed up this week with fresh, on-the-record comment from compliance specialists on what the plan would mean once finalised. “It’s stricter because of trace-freeze-burn, recovery and wind-down plans, quarterly stress tests, and the ban on paying interest to holders,” Claudia Hui, Asia-Pacific head of compliance advisory at TRM Labs, Inc., said. No MAS response to the consultation, draft legislation, or commencement date has been published; MAS’s only prior consultation on this same framework, which closed in December 2022, took until August 2023 to produce a published response.
Who It Affects
This is a proposal aimed at companies and banks, not a change to individuals’ existing ability to hold stablecoins. The obligations apply to issuers seeking to offer an “MAS-regulated” stablecoin in Singapore, to foreign issuers applying for MAS recognition to serve cross-border wholesale transactions, and to banks, which would need to set up a separate non-bank entity to issue stablecoins under the proposed framework, law firm Reed Smith’s Etelka Bogardi told Asian Banking & Finance. Stablecoins that fall outside the new framework — which, in practice, is nearly all stablecoins today, since the framework does not yet exist — continue to be treated as Digital Payment Tokens (DPTs) under Singapore’s existing Payment Services Act, exactly as before this proposal, Baker McKenzie noted in its analysis of the paper. In other words, the proposal does not create or remove any individual’s ability to personally buy or hold a foreign stablecoin in Singapore through an already-licensed service provider — that pre-existing DPT framework is unchanged.
Bogardi expects payment companies already licensed to handle digital payment tokens — she named StraitsX and Paxos specifically, citing their existing in-principle MAS approvals — to be among the main applicants for a stablecoin-issuer licence once the framework takes effect.
Background So Far
Singapore’s current rules already treat stablecoins as Digital Payment Tokens, requiring exchanges and other service providers to hold a Payment Services Act licence to offer them — the baseline this proposal builds on rather than replaces. MAS first consulted on a dedicated single-currency-stablecoin framework in October 2022 and published its response to that round in August 2023. This September’s paper is a further, more detailed round covering a Singapore-incorporated issuer licence, the foreign-issuer recognition route described above, and a new power for MAS to designate a stablecoin “systemic” — regardless of where it is issued — and impose similar reserve, redemption, and recovery-planning requirements on it, Reed Smith said. MAS compared its approach to Hong Kong’s, under which issuers operating there, or issuing Hong Kong dollar-linked stablecoins, must obtain a local licence and may only have unlicensed stablecoins distributed to professional investors; Singapore’s proposal would allow certain financial institutions to distribute stablecoins issued by unlicensed companies, Bogardi told Asian Banking & Finance.
Outlook
MAS Deputy Managing Director (Financial Supervision) Ho Hern Shin said in the 1 September release that the proposed amendments “will give effect to a framework” that “promotes responsible financial innovation,” and that trusted, well-regulated stablecoins “can serve as a credible settlement asset in tokenised financial markets.” In a separate emailed statement this week, MAS said it would assess cross-border issuance arrangements “individually, subject to safeguards,” adding that “well-regulated stablecoins can potentially deliver efficiency gains, lower transaction costs, and incorporate programmable features.” Hui expects banks to consider issuing stablecoins for corporate cash management, international settlement, and trade finance, and expects international issuers to pursue recognition or joint-issuance arrangements rather than standalone Singapore licences: “the standards are high, but for serious issuers, that’s the appeal… a Singapore licence or recognition tells counterparties worldwide that the issuer can be trusted.” Several requirements remain unresolved in the proposal, including minimum cash reserves, issuance limits, and rules for stablecoins offered in Singapore outside MAS regulation, Hui and Bogardi said; Singapore’s Payment Services Act itself would also need to be amended before any of this takes effect.
References
Monetary Authority of Singapore – MAS Consults on Legislative Amendments to Implement Stablecoin Regulatory Framework / Singapore Business Review – Singapore Opens Door to Foreign Stablecoins Under Tighter Rules / Reed Smith LLP – MAS Consults on Implementation of Singapore Stablecoin Regime / Baker McKenzie – Singapore: MAS Introduces Stablecoins Framework Under Payments Legislation
