A Dedicated Licence Class for Stablecoin Issuers
The centrepiece of Singapore’s proposed stablecoin regulatory framework is the introduction of a standalone “stablecoin issuance licence” — a new regulatory category sitting alongside existing licence classes such as the Major Payment Institution (MPI) and Standard Payment Institution licences under the Payment Services Act 2019.
This dedicated licence class represents a fundamental shift in how Singapore approaches stablecoin oversight. Under the proposed amendments to the PS Act, only entities holding a stablecoin issuance licence from MAS may hold themselves out as issuers of MAS-regulated stablecoins. The licensing framework is designed to ensure that stablecoin issuance is treated as a distinct regulated activity, separate from money-changing, payment processing, or digital payment token (DPT) services.
Eligibility Criteria: Who Can Apply for a Stablecoin Issuance Licence
The consultation paper sets out clear eligibility parameters for prospective licence holders. Eligible applicants must be Singapore-incorporated entities issuing single-currency stablecoins pegged to the Singapore dollar or any G10 currency. The framework applies specifically to stablecoins that maintain a high degree of value stability, excluding algorithmic or multi-currency stablecoins from the current scope.
MAS will take a selective and risk-based approach in granting licences, assessing applications based on financial soundness, business viability, and operational track record. This implies that not all applicants will qualify — MAS intends to exercise supervisory discretion in admitting stablecoins into the MAS-SCS framework.
Permitted Business Activities and Restrictions
The proposed framework imposes strict limitations on the business activities of licensed stablecoin issuers. Issuers may only conduct activities directly related to the issuance of MAS-regulated stablecoins. They are prohibited from issuing non-MAS-regulated stablecoins or engaging in unrelated business activities.
However, the draft does provide flexibility for ancillary activities: no separate payment service licence is required where the issuer also undertakes DPT-related activities that are incidental to its stablecoin issuance business. This allows issuers to provide redemption services or facilitate transfers without seeking additional regulatory approvals.
Capital and Prudential Requirements
Beyond the 100% reserve backing requirement, the consultation paper outlines additional prudential safeguards. Issuers must maintain a minimum base capital of SGD 1 million, along with reserves held in low-risk, highly liquid assets stored in segregated accounts with qualified custodians.
The framework also requires issuers to have recovery and orderly wind-down plans in place. Licensed issuers must demonstrate stress testing capabilities and the technical ability to trace, freeze, and burn stablecoins found to be used for illicit activity.
Real-World Context: Bank of Singapore and Singapore Gulf Bank Lead Institutional Adoption
The practical implications of Singapore’s licensing regime are already visible in the banking sector. Singapore Gulf Bank (SGB), backed by Whampoa Group and Mumtalakat, launched a regulated platform in early 2026 that integrates fiat currencies and stablecoins into a single banking network. The bank’s SGB Net clearing system now supports stablecoin settlement capabilities for institutional clients, with access opening in Q1 2026.
SGB’s integration of stablecoin mint and redeem services — allowing institutional clients to convert fiat directly to stablecoins and back — illustrates how MAS’s regulatory clarity is enabling traditional financial institutions to embrace digital asset infrastructure.
Compliance Deadlines and Next Steps for Issuers
The consultation period closes on 16 October 2026, after which MAS will review feedback and finalise the legislative amendments. Issuers operating or intending to operate in Singapore must determine whether their tokens meet the single-currency stablecoin definition and decide whether to seek a PS Act licence. Those that do not obtain a licence cannot represent their tokens as MAS-regulated, which will affect institutional distribution within Singapore and in markets that recognise the MAS label.
