Discover how Singapore’s strengthened crypto regulations under the PS Act have solidified its position as Asia’s top digital asset hub. Learn about the evolving framework and its impact.
Singapore Strengthens Its Role as a Leading Crypto Hub
Singapore is reinforcing its position as Asia’s leading cryptocurrency hub through expanded regulatory measures and an increase in licensed payment institutions. With over 200 licensed Major Payment Institutions (MPIs) and rising applications for Digital Payment Token (DPT) services, Singapore has attracted major global crypto players, including Okx, Upbit, Anchorage, and Bitgo. The Monetary Authority of Singapore (MAS) is leading these efforts by implementing a rigorous regulatory framework under the Payment Services Act (PS Act).
MAS Licensing Framework and Evaluation Process
MAS managing director Chia Der Jiun explained the comprehensive licensing process in an interview with the Business Times on Dec. 28. He highlighted the agency’s focus on strict compliance measures and risk management capabilities.
MAS considers various factors when assessing license applications, including fit and proper criteria for management, effective compliance arrangements, and strong risk management capabilities, including the management of money laundering and terrorist financing risks, Chia said.
The PS Act, introduced in January 2020, follows an activity-based licensing framework to mitigate risks associated with payment services, including DPT services. The framework enables regulatory oversight while allowing room for growth and innovation.
Evolution of Crypto Regulations in Singapore
Singapore’s regulatory landscape has evolved in response to market developments, including the crypto market’s volatility in 2021 and the collapse of major firms during the 2022 crypto winter. In April 2023, MAS expanded the scope of regulated activities under the PS Act to address emerging risks.
Since the commencement of the PS Act in January 2020, the number of licensed MPIs in Singapore has grown to over 200, Chia noted
He emphasized that the evolving framework addresses specific risks while facilitating innovation in the rapidly changing digital asset sector.
As the digital asset landscape and the risks evolve, we have continued to strengthen and refine our regulatory framework to address risks as they arise, and to facilitate innovation as appropriate.
MAS has received more than 250 applications for DPT services, over 30 of which were submitted after the scope expansion in April 2023. Chia elaborated on the proactive steps taken to refine regulations:
Safeguarding Investors and Fostering Growth
The MAS approach highlights a balance between investor protection and fostering innovation. By implementing targeted regulations, Singapore aims to minimize risks such as money laundering and market instability while maintaining an attractive ecosystem for digital asset firms.
The city-state’s clear and structured regulatory environment has positioned it as a preferred destination for cryptocurrency operators looking to expand in Asia.
As Singapore continues to lead the way in digital asset regulation, stakeholders in the crypto industry are encouraged to engage with the MAS framework to ensure compliance and leverage growth opportunities.
