MAS Proposes Payment Services Act Amendments for Stablecoin Regulation

The Monetary Authority of Singapore (MAS) published a consultation paper on 1 September 2026 setting out proposed legislative amendments to the Payment Services Act 2019 (PS Act) that would bring its single-currency stablecoin regulatory framework into force. The paper carries consultation number P015-2026 and invites written comments by 16 October 2026.

The draft amendments would implement the MAS Single-Currency Stablecoin (MAS-SCS) framework, under which only issuers licensed under the regime may describe themselves as licensed MAS-regulated stablecoin issuers and market their tokens as “MAS-regulated stablecoins”. Stablecoins outside the framework will be treated as Digital Payment Tokens (DPTs) and remain subject to the consumer protection safeguards that already apply to DPTs. The framework will apply to single-currency stablecoins issued in Singapore that are pegged to the value of the Singapore Dollar or any G10 currency.

Licensing and Core Issuer Obligations

The draft legislation introduces a new licence class for stablecoin issuance, according to the consultation paper. Issuance would include incidental activities such as minting, putting coins into circulation, managing reserve assets, and redeeming at par. Core obligations require issuers to maintain reserve assets at least equal to the par value of all stablecoins in circulation, to fulfil redemption requests in the pegged currency within MAS-prescribed timeframes, and to safeguard customer funds until stablecoins are delivered.

To mitigate contagion risk, issuers will not be permitted to conduct other regulated activities beyond MAS-regulated stablecoin issuance, though they may provide DPT services in respect of their own issued stablecoins where incidental to the issuance business.

The paper also proposes new requirements developed since the framework was finalised. Issuers of MAS-regulated stablecoins would be prohibited from paying interest, returns, or any other benefit attributable to the holding of the stablecoins, a prohibition MAS states is not intended to disturb revenue-sharing or distribution arrangements with third parties. MAS is separately consulting on whether to restrict issuers from on-lending customer monies or using such monies and the interest earned on them to materially finance their business, and is considering a minimum proportion of reserve assets to be held in cash or bank deposits, noting that the UK and EU require or will require minimum bank-deposit proportions of 5% to 30% for non-systemic stablecoins and 40% to 60% for systemic stablecoins.

Additional proposals include quarterly stress testing, powers for MAS to impose extra capital, liquidity, or reserve buffers where stress tests reveal critical vulnerabilities, board-approved recovery and orderly wind-down plans reviewed at least annually, and a requirement that issuers maintain the technical capability to trace, freeze, and/or burn stablecoins found to be used for illicit activity. MAS is also weighing caps on aggregate issuance or individual holdings.

Systemic Designation and Cross-Border Proposals

A new Part 2A of the PS Act would empower MAS to designate a stablecoin as a “Designated Systemic Stablecoin”, whether issued inside or outside Singapore and whether or not regulated under the MAS-SCS framework. Designated issuers must comply with requirements in line with those on MAS-regulated stablecoins, including reserve, redemption, prudential, and white paper obligations. Where a designated systemic stablecoin fails to meet requirements, MAS may direct licensed DPT service providers in Singapore to cease offering it, delist it and its trading pairs, and prohibit further accumulation by customers. Designation factors include size in circulation, interconnectedness with payment systems and the broader financial system, and substitutability.

Reversing its 2023 position, MAS now proposes to allow multi-jurisdictional issuance, in which the same fungible stablecoin is issued concurrently by a Singapore-incorporated issuer and foreign co-issuers sharing one reserve pool. Under a proposed section 100A, MAS may grant case-by-case exemptions from the requirements that every issuer be incorporated in Singapore and that the Singapore licensee hold reserves at least equal to all coins in circulation. Conditions include supervision of the foreign issuer under a regime MAS deems substantively equivalent, supervisory cooperation arrangements, reserves meeting the stricter of the applicable regimes, total reserves equivalent to at least 100% of the par value of outstanding coins held in segregated trust accounts, and daily reserve records submitted to MAS monthly.

A proposed new Part 2B would let MAS recognise a limited number of foreign-issued stablecoins regulated under comparable foreign frameworks, citing cross-border wholesale use cases. The paper also states that banks and merchant banks wishing to issue MAS-regulated stablecoins must do so through a separate non-bank legal entity, and that wholesale banks and merchant banks would effectively be prohibited from issuing SGD stablecoins freely tradeable by retail individuals, while retaining room for wholesale use cases such as trade finance.

MAS first consulted on its stablecoin regulatory approach on 26 October 2022 and published its response finalising the framework on 15 August 2023. It will consult on the subsidiary legislation, covering reserve composition, redemption timelines, and recognition conditions, at a later date. Ms Ho Hern Shin, MAS Deputy Managing Director (Financial Supervision), said the amendments “will provide clear regulatory guardrails for stablecoins that meet high standards of value stability and governance.”

Digital asset infrastructure provider Fireblocks published a response to the consultation on 3 September 2026, stating that its mint and burn controls, freeze-and-block capabilities, and segregation and reserve-custody operations map to the framework’s proposed requirements. The company said its infrastructure can trace flows across jurisdictions for multi-jurisdictional arrangements and support the daily records and monthly reporting MAS requires.

The consultation closes at 11.59 PM on 16 October 2026, according to the consultation listing. MAS stated that it expects a selective, risk-based approach to authorisation, resulting in a limited number of stablecoins being authorised or recognised, assessed on financial soundness, business viability, and operational track record.