SINGAPORE Law and Practice Contributed by: Tju Liang Chua and Ulanda Oon, Drew & Napier LLC
financial sector, publishing governance guidelines for responsible use. On tokenisation, he noted that eco- system fragmentation remains a concern: proprietary platforms risk creating “sub-scale walled gardens” with trapped liquidity, an issue that GL1 is specifically designed to address. These structural concerns are compounded by an expanding regulatory perimeter. Businesses offering blockchain-based services will have to flexibly adapt and adjust to enhanced regulation and licensing in Singapore. The amendments to the Payment Services Act 2019 (the “PS Act”) came into force in April 2024 while the provisions relating to digital token service providers (DTSPs) under the Financial Services and Markets Act (FSMA) came into force on 30 June 2025 (see 1.1.3 Regulation of Blockchain Technology , 2.1 Regulators and International Alignment and 2.2 Crypto-Asset Regulatory Frameworks ). The broadening of regulatory oversight also extends to stablecoins, where draft legislation to implement a dedicated regime is being finalised. Under this framework, certain activities relating to single cur- rency pegged stablecoin issuance will be separately regulated. Presently, MAS has granted in-principle approval under the PS Act to three entities, which will issue stablecoins that substantively comply with the upcoming stablecoin regulatory framework. At the time of writing, MAS is still working on the legislative amendments. As the regulatory framework for blockchain matures, intellectual property (IP) considerations also warrant attention. Singapore’s technology-neutral regulatory approach means that blockchain activity is governed by existing IP laws rather than bespoke legislation. The primary form of IP protection for blockchain projects is copyright over source code, for which an appropriate open-source or proprietary licence may be opted for. 1.1.2 Regulatory Sandbox The MAS offers a FinTech Regulatory Sandbox to encourage local projects to pursue innovative financial products and services within a secure, efficient and low-regulatory-pressure environment.
There are three options: Sandbox, Sandbox Express and Sandbox Plus. The Sandbox option is for more complex business models where customisation is required to balance the risks and benefits of the experiment. The Sandbox Express option is for activi- ties where risks are low and well understood by the market. It relies on disclosures and predetermined rules, providing a faster option for market testing. The Sandbox Plus option expands the eligibility criteria to include early adopters of technological innovation. It also provides financial grants for first movers in tech- nology innovation. A successful use case of the Sandbox is DigiFT Tech (Singapore) Pte Ltd, a Singapore-based regulated exchange for on-chain real world assets. It exited the Sandbox on 30 November 2023 and holds a capital markets services (CMS) licence for dealing in capital markets products (CMPs) that are securities or units in a collective investment scheme. It is also a recognised market operator (RMO) under the SFA. 1.1.3 Regulation of Blockchain Technology Singapore adopts a generally progressive and tech- nology-agnostic approach to blockchain regulation, focusing on regulating the underlying activity rather than the enabling technology itself. There is no single piece of legislation governing the use of blockchain in Singapore. Existing legislation and regulations have instead been, and are continually being, expanded or clarified to address blockchain use issues. Singapore’s regulatory regime centres on three key statutes: the Securities and Futures Act (SFA), the PS Act and the FSMA (see 2.2 Crypto-Asset Regula- tory Frameworks ). The SFA governs the capital mar- kets and financial investments sector in Singapore and covers digital assets with the characteristics of CMPs, while the PS Act regulates payment services (PSs), including those involving digital payment tokens (DPTs) provided in Singapore. The FSMA extends AML/CFT obligations to DTSPs operating from Singa- pore and providing digital token (DT) services outside Singapore. While the MAS encourages innovation (see 1.1.1 Evolution of Uses of Blockchain ) and has published guidance like the Guide on the Tokenisation of Capi-
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