Singapore Sets June 30 Deadline for Crypto Licensing Under New Compliance Rules

• MAS requires all crypto firms operating from Singapore, including offshore-serving ones, to obtain licenses by June 30.
• Firms must meet strict compliance, including SGD 250,000 capital, FATF standards, and tech risk controls.

Singapore has issued a firm directive to unlicensed digital asset service providers operating from its jurisdiction. The Monetary Authority of Singapore (MAS) has enforced a strict June 30 deadline for these firms to either obtain licenses or cease operations immediately. This includes companies that serve only offshore customers but operate or employ staff within Singapore.

Offshore-Focused Firms Also Covered Under New Licensing Mandate

MAS is now enforcing Section 137 of the Financial Services and Markets Act (FSM Act). This provision stretches policy oversight to Digital Token Service Providers (DTSPs) operating from Singapore, even if their services do not target local clients. According to MAS, this regulation aims to eliminate any jurisdictional loopholes that offshore-facing firms previously relied upon.

The rules apply broadly to include proprietary trading desks, over-the-counter platforms, and infrastructure providers. MAS rejected calls for exemptions from such firms during a consultation conducted in October 2024. The regulator cited increased risks tied to money laundering and terrorism financing as the rationale for a zero-exemption policy.

Licensing Requirements Include Capital and Risk Controls

To gain licensing, firms must meet specific criteria. Each must hold a minimum base capital of SGD 250,000 (about USD 185,000). They must also re-onboard all existing customers with updated due diligence measures. Compliance with the Financial Action Task Force (FATF) Travel Rule is mandatory.

In addition, digital asset service providers are required to follow robust technology risk management frameworks. These include cybersecurity protections and operational resilience protocols. MAS also confirmed that individual consultants and freelancers working for foreign crypto firms from within Singapore are subject to the same requirements.

Licensing Landscape and Global Context

As of now, MAS has issued 33 Major Payment Institution licenses. These were granted to firms including DBS Vickers, OKX, Circle, Upbit, and Coinbase. Another firm, Cumberland SG, has received in-principle approval and awaits final licensing confirmation.

The new framework places Singapore in alignment with other global regulators. For example, Australias AUSTRAC recently imposed a fine exceeding USD 75,000 on Cointree. The penalty was for failing to submit timely reports on suspicious transactions, which delayed law enforcement investigations.

MAS has stated that from July 1, only licensed digital asset entities will be permitted to operate. Firms failing to comply by the deadline will be required to shut down operations without exception.