SINGAPORE : The Monetary Authority of Singapore (MAS) has reaffirmed its stance on upcoming regulatory changes affecting Digital Token Service Providers (DTSPs), emphasising that firms should have adequately prepared for the licensing requirements coming into force on 30 June.
In a clarification issued on 6 June, following a consultation paper released on 30 May, MAS stated that DTSPs offering services exclusively to overseas clients—whether dealing in digital payment tokens such as cryptocurrencies or tokenised capital market products like digitalised securities—must obtain a licence by the end of the month or cease operations entirely.
The authority underscored that the licensing threshold is deliberately stringent and that approvals will generally not be granted to such firms. MAS reiterated that DTSPs currently providing services to clients within Singapore are already under regulatory oversight and will continue to operate under existing frameworks.
In contrast, providers handling utility or governance tokens remain outside the scope of the new requirements, as these types of tokens are not subject to the revised regime.
The updated guidance follows MAS’ review of industry feedback on the May consultation, which identified firms serving only offshore clients as particularly susceptible to money laundering and terrorism financing threats due to their inherently cross-border, internet-based business models.
MAS stressed that the objective of the new framework is to strengthen regulatory oversight, mitigate illicit financial activity, and uphold Singapore’s status as a reputable and forward-looking global hub for digital assets.
Despite these intentions, the regulatory update has triggered unease within parts of the industry. Reports from Bloomberg indicate that several firms, including cryptocurrency exchanges Bitget and Bybit, are contemplating exiting Singapore, citing compliance hurdles and operational uncertainty. The regulatory changes have also been linked to job cuts and the relocation of staff.
Industry sources estimate that over 500 professionals—from senior management to junior-level staff—across fintech and digital asset firms may relocate to jurisdictions such as the United Arab Emirates or Hong Kong, where the regulatory environment is perceived as more accommodating.
In response to Bloomberg’s report, MAS noted that the licensing requirement should not come as a surprise. The central bank stated it has communicated its regulatory intentions clearly since 2022, and it does not anticipate the new rules will materially impact a significant number of entities operating in Singapore.
-The Strait Times
