MAS Confirms Near-Ban on Foreign-Only Digital Token Services
The Monetary Authority of Singapore (MAS) has shed light on its Digital Token Service Providers (DTSPs) regime, following widespread panic in the industry over a potential ban on crypto firms serving overseas clients
In a June 6 announcement, MAS reiterated that starting June 30, crypto firms “providing services solely to customers outside of Singapore relating to digital payment tokens and tokens of capital market products will need to be licensed.”
However, the regulator warned that such licenses will be granted only in “extremely limited circumstances.”
“MAS has set the bar high for licensing and will generally not issue a licence,“ the agency said, citing the difficulty of supervising offshore firms and money laundering risks as key concerns.
MAS is unable to effectively supervise such persons,” the regulator added. Consequently, businesses unable to obtain licenses will “have to cease their regulated activities.”
Related: UK FCA proposes lifting ban on crypto ETNs for retail investors
The start of a crypto exodus?
The crypto market took notice when the MAS set a deadline of June 30 for local crypto service providers to stop offering digital token services to overseas markets earlier this month.
The new rules have already triggered a shift. India-serving but Singapore-based crypto exchange WazirX announced that it will be moving its operations to Panama, shortly after the MAS announced the deadline.
At the time of the deadline announcement, Hagen Rooke, a partner at Gibson, Dunn & Crutcher, said that licenses would be issued only in rare cases. In a LinkedIn post, he stated:
“The MAS will grant licences under the new framework only in extremely limited circumstances (as this type of operating model generally gives rise to regulatory concerns, e.g. AML/CFT-related).”
Related: Europe gears up to regulate DeFi in 2026 as MiCA leaves sector in limbo
Singapore tightens crypto controls
Recent moves by Singapore regulators suggest that local authorities intend to maintain stricter control over the local crypto industry. Today’s announcement clarified that crypto companies serving customers in Singapore “are already subject to regulation,” so the rules have been expanded to those serving customers abroad. Still, MAS said not all crypto-related services are affected:
“Providers of services in relation to other tokens, such as those only used as utility and governance tokens, are not subject to licensing or regulation under the new regime, and hence are not impacted.“
Singapore’s regulatory shift follows May reports that digital assets are popular in the country. Crypto awareness in Singapore has reached an all-time high, with 94% of respondents in a recent survey indicating familiarity with at least one digital asset.
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