Singapore proposes licence regime for stablecoins

TLDR

Singapores central bank has proposed a new licensing regime for stablecoin issuers to bring stablecoins under a formal, payments-focused regulatory framework.

1. MAS would require licensed stablecoins to hold 100 percent reserves, allow redemption at par, and follow strict disclosure and capital rules, with tokens labeled as MAS regulated stablecoins.
2. Issuers would be barred from paying interest or yield on regulated stablecoins, pushing them toward payment and settlement use instead of serving as interest bearing savings products.
3. The framework is still in public consultation until October 16 2026, so issuers and users should watch which coins qualify and how strictly foreign stablecoins will be treated.

Confidence: high because the proposals are set out in MAS consultation materials and multiple independent reports.

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Deep Dive

1. What MAS Is Proposing

The Monetary Authority of Singapore (MAS) has proposed amendments to the Payment Services Act to turn its stablecoin policy into a formal legal framework and introduce a dedicated stablecoin issuance license for regulated issuers, according to recent consultation coverage from CryptoBriefing.

Only issuers that meet the regime could market their tokens as MAS regulated stablecoins, a label explicitly reserved in the proposals described in MAS focused analysis on CoinsKid Community. The framework mainly targets single currency stablecoins issued in Singapore and pegged to the Singapore dollar or a G10 currency, but MAS is also considering paths for jointly issued and foreign stablecoins.

The proposals are at consultation stage, not yet law, with MAS inviting public and industry feedback before finalizing any rules.

2. Key Requirements And Bans

Under the draft regime, issuers of regulated stablecoins would need to maintain reserves covering at least 100 percent of outstanding tokens, ensure redemption at par, meet minimum capital standards, and provide clear disclosures, as outlined in MAS oriented reports on CoinsKid Community.

MAS also proposes banning issuers from paying interest, yield, or other benefits calculated by reference to a customers stablecoin balance, aligning with analysis that stablecoins should not be used by the public as investment products reported by Yahoo Finance. Issuers would be required to conduct regular stress tests and maintain recovery and orderly wind down plans.

Stablecoins that do not fall under the dedicated framework would remain in the existing digital payment token bucket, subject to broader crypto rules rather than the more specific stablecoin label.

3. Who Is Affected And What To Watch

The regime is designed to cover both domestic issuers and, potentially, some jointly issued or foreign stablecoins that are regulated under comparable overseas frameworks, especially for cross border wholesale transactions, as discussed in Cointelegraphs coverage. This keeps the door open for major dollar stablecoins to seek recognition if they meet MAS standards.

Large firms may be best placed to absorb the compliance burden, while smaller issuers could find the capital, reserve, and governance requirements challenging. For users, the key changes would be clearer labels, stronger backing rules, and no interest on regulated stablecoins held as balances.

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Conclusion

Singapores proposed license regime signals that stablecoins are moving into a tightly supervised, payments focused space, with full reserve backing, clear redemption rights, and stricter conduct rules for issuers.

If the framework is implemented after consultation, it could reinforce Singapores role as a major digital asset hub while nudging stablecoin use toward settlement and payments, and away from yield driven savings, with the exact impact depending on which domestic and foreign coins qualify under the final rules.