SINGAPORE Law and Practice Contributed by: Kenneth Pereire and Lin YingXin, KGP Legal LLC
10.3 Classification of Blockchain Assets In Singapore, the regulation of blockchain assets depends on their characteristics, with MAS applying different frameworks to each type. Digital Payment Tokens (DPTs) Cryptocurrencies like Bitcoin and Ethereum are regulated under the PSA. Entities providing DPT services, such as exchanges, must obtain licenses and comply with AML and customer protection rules. Securities Tokens Tokens representing ownership in assets like stocks or bonds are regulated under the SFA. Issuers must meet prospectus requirements and intermediaries require capital markets services licences. Utility Tokens Utility tokens providing access to products or services are generally not regulated unless they resemble financial instruments. However, issu - ers must comply with consumer protection laws. 10.4 Regulation of “Issuers” of Blockchain Assets In Singapore, the regulation of issuers of block - chain assets, including cryptocurrencies, is pri - marily governed by the PSA and SFA. Entities engaging in the issuance of DPTs or e-money for payment transactions must obtain a licence from the MAS and adhere to stringent anti-mon - ey laundering AML/CFT measures to mitigate associated risks. Additionally, issuers of securi - ties tokens, representing ownership in traditional assets like stocks or bonds, are regulated under the SFA. For securities tokens, issuers must prepare and lodge a prospectus with MAS before offering them to the public, disclosing comprehensive
For example, MAS has partnered with partici - pants in the industry to conduct a collaborative project, “Project Ubin” , to explore the use of blockchain and distributed ledger technology for the clearing and settlement of payments and securities. The payments network prototype that was developed through this project would facilitate the development of a cross-border pay - ments infrastructure, as well as customer appli - cations. 10.2 Local Regulators’ Approach to Blockchain Consultation Papers and Amendments MAS actively engages stakeholders through consultation papers to refine regulations on blockchain and digital token activities. A notable example is the 2023 consultation on amendments to the Payment Services Regula - tions 2019, proposing safeguards like statutory trusts for customer assets and restrictions on retail token lending and staking. By 2025, MAS expanded these measures to cover more com - plex blockchain applications, ensuring consum - er protection and market stability. Expansion of Regulatory Scope and Collaborative Initiatives Under the Financial Services and Markets Act 2022, MAS targets overseas digital token provid - ers servicing Singapore to mitigate cross-border risks. Enhanced AML/CFT measures and strict - er compliance requirements reflect MAS’ pro - active regulatory stance. Collaborative efforts through the Singapore Blockchain Innovation Programme (SBIP) now focus on interoperabil - ity, DeFi governance and sustainable blockchain development. These initiatives reinforce Singa - pore’s position as a blockchain innovation hub while safeguarding market integrity and con - sumer trust.
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