Singapore Stablecoin Regulation Gains Legal Teeth Under MAS Plan

Singapore's central bank has moved to write its stablecoin rulebook into binding law. On 1 September 2026, the Monetary Authority of Singapore (MAS) opened a public consultation on amendments to the Payment Services Act 2019 that would convert the stablecoin framework it finalised in 2023 from stated policy into enforceable statute. Interested parties have until 16 October 2026 to respond.

Requirements that were previously supervisory expectations would become legal obligations, testable and enforceable, with the "MAS-regulated stablecoin" label reserved for those that comply.

What has MAS actually proposed?

The consultation paper sets out the legislative text needed to bring the 2023 single-currency stablecoin framework into force through the Payment Services Act. It targets single-currency stablecoins issued in Singapore and pegged to the Singapore dollar or a G10 currency, and it establishes stablecoin issuance as a distinct regulated payment service.

MAS is also proposing several additions that go beyond the 2023 settlement. Three stand out: a ban on paying interest to holders of MAS-regulated stablecoins, mandatory stress testing, and a requirement for issuers to hold recovery and orderly wind-down plans. The regulator further proposes to extend safeguarding duties already applied to Payment Services Act licensees, including protection of customer monies received before tokens are issued.

A separate strand of the consultation opens the door to recognising a limited set of foreign stablecoins. Under the proposal, qualifying tokens jointly issued in Singapore and abroad, or governed by comparable overseas regimes, could carry the MAS-regulated designation. That is a notable widening of a framework that until now applied only to coins issued domestically.

What must stablecoin issuers do differently?

The core obligations largely carry over from 2023, but statute changes the stakes. A licensed issuer would need to hold reserve assets covering at least 100% of tokens in circulation at all times, in low-risk liquid instruments, segregated from the issuer's own assets, held with approved custodians, and subject to independent monthly attestation and annual audit. Redemption at par must be honoured, with the earlier framework setting a five-business-day window.

Scale determines the licence. A non-bank issuer whose stablecoins in circulation exceed, or are expected to exceed, S$5 million must hold a Major Payment Institution licence, while bank issuers follow the substantive rules without that separate licensing step. On capital, issuers face a base floor of the higher of S$1 million or 50% of annual operating expenses, with a portion held in liquid form. The interest ban is the sharpest commercial constraint: it removes one of the fastest-growing levers seen elsewhere in the market, where yield-bearing structures have driven much of recent supply growth.

How does the Singapore approach compare with the US and EU?

Singapore is converging with the two other major regimes while keeping its own design. The US GENIUS Act, signed in July 2025, requires full reserves in cash and short-dated Treasuries, bans yield to holders, and routes federally licensed non-bank issuers to the Office of the Comptroller of the Currency. The EU's Markets in Crypto-Assets Regulation (MiCA), applicable to stablecoins since mid-2024, treats fiat-pegged coins as e-money tokens that only licensed credit or e-money institutions may issue, a rule that pushed several exchanges to delist Tether's USDT for European users.

The common thread across all three is full backing, redemption rights, and a firm line against paying interest. Singapore's distinguishing features are its currency scope, SGD and G10 pegs only, and its willingness to explore recognition of comparable foreign coins rather than close its market to them.

Why does the timing matter?

The proposal lands as stablecoins move from trading venues into mainstream payment and settlement. Total stablecoin market capitalisation sits at roughly US$300 billion to US$316 billion in 2026, up sharply year on year, with dollar-pegged tokens dominating supply. MAS has tied its framework explicitly to asset tokenisation, positioning well-regulated stablecoins as a credible settlement asset as tokenised assets gain traction.

The regulatory runway is deliberate. By opening a six-week window, MAS gives issuers, exchanges, and payment firms a defined period to prepare rather than absorb a sudden rule change. Codified standards are widely expected to sort the market into regulated and unregulated tiers, raising the bar for entry while lifting confidence in tokens that carry an official label.

Why This Matters to FinanceX Readers

This is the moment stablecoin risk in Singapore becomes legally legible. Once compliance is enforceable rather than encouraged, the MAS-regulated label turns into a genuine due-diligence signal: firms building payment, settlement, or treasury products on stablecoins can point to a testable standard, and counterparties can price the difference between regulated and unregulated tokens. For issuers weighing where to domicile, Singapore's openness to recognising comparable foreign coins is worth watching closely, because it shapes which tokens can reach the region's institutional demand.