The Monetary Authority of Singapore (MAS) has launched a consultation on amendments to the Payment Services Act that would turn its 2023 stablecoin framework into legislation. The headline shift is a reversal on multi jurisdiction issuance. Having said in 2023 that a stablecoin issued concurrently from Singapore and abroad could not qualify as “MAS-regulated”, MAS is now prepared to allow such stablecoins to carry that label, provided the foreign issuer is subject to a substantively equivalent regime and safeguards are in place.
The consultation also probes the economics of stablecoin issuance in a way few regulators have. Draft regulations would prohibit issuers from using customer monies, and the interest earned on them, to materially finance the business. Given that reserve interest is the primary revenue source for most standalone issuers, MAS acknowledges the tension and asks whether the prohibition is needed at all, and if so, how it should be calibrated.
Beyond those two items, the amendments introduce a designation regime for systemic stablecoins, a recognition path for foreign regulated stablecoins, and rules requiring banks to issue stablecoins through separate legal entities. Consultation responses are due by 16 October.
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