MAS opens consultation on stablecoin licenses

TLDR

Singapores Monetary Authority has opened a public consultation on creating a dedicated license regime for MAS?regulated stablecoins.

1. MAS proposes a new stablecoin issuer license with strict rules on full reserves, par redemption and use of the MAS?regulated stablecoin label.
2. The framework would ban interest or yield on regulated stablecoins and may recognize certain jointly issued or foreign tokens for cross?border use.
3. The consultation runs until 16 October, after which MAS will finalize rules that could reshape which stablecoins institutions and payment firms are willing to use in Singapore.

Deep Dive

1. What MAS Is Proposing

MAS has published draft amendments to the Payment Services Act to put a formal stablecoin regime into law, including a dedicated licence for issuers of single?currency stablecoins pegged to SGD or G10 currencies, with only licensed issuers allowed to use the MAS?regulated stablecoin label under the framework. These issuers would need to hold reserves equal to at least 100 percent of outstanding tokens and offer redemption at par, creating bank?like guarantees around value stability and convertibility, as outlined in MAS proposed amendments to the Payment Services Act.

Additional safeguards include quarterly stress tests, capital requirements, and systems to trace, freeze or burn tokens linked to illicit activity, with non?compliant but systemically important stablecoins potentially facing circulation limits or delisting from licensed providers under the dedicated licence proposal.

2. Why It Matters For Stablecoins And Users

MAS intends to ban issuers from paying interest or other holder benefits on MAS?regulated stablecoins, reinforcing their role as payment instruments rather than savings products and aligning with emerging rules in the US and EU that restrict stablecoin yield. At the same time, MAS is reconsidering its domestic?only stance, proposing recognition for stablecoins jointly issued by a Singapore entity and a foreign partner, and a limited set of foreign?issued coins regulated under comparable regimes for cross?border wholesale use, per its joint issuance and foreign recognition proposals.

For issuers like Circle or bank?backed projects, being able to qualify as MAS?regulated could become a credibility signal for institutional settlement and tokenised markets, while yield?bearing cash?plus structures may need to sit outside the MAS?regulated label or be redesigned.

3. Timeline And Signals To Watch

The consultation is open until 16 October 2026, and the proposals are not yet law, giving issuers, exchanges and payment firms a window to lobby on details such as reserve composition, redemption timelines and treatment of foreign coins. After MAS digests feedback, it will finalize the framework and implement it through Payment Services Act revisions, which will determine how costly compliance is and which existing stablecoins can realistically qualify as MAS?regulated.

Crypto users should watch for three signals: which issuers publicly seek MAS licences, how local platforms adjust support for non?compliant tokens, and whether MAS?regulated status becomes a requirement for using stablecoins in major tokenisation or remittance projects.

Conclusion

MASs consultation marks a decisive move to turn its earlier stablecoin principles into binding law, with a licence regime that emphasizes full reserves, par redemption and strict consumer safeguards. If implemented close to the current draft, it will formalize a high?trust tier of payment?grade stablecoins and selectively open the door to foreign and jointly issued tokens, while sidelining yield?centric designs. For crypto users and builders, the key is to monitor which stablecoins earn MAS?regulated status, as that badge could become a primary filter for institutional adoption and cross?border payment rails in Asia.