The Monetary Authority of Singapore (MAS) has provided clarification on the scope of its regulatory regime for Digital Token Service Providers (DTSPs).
The announcement follows the authority’s 30 May response to feedback on its consultation paper on the Proposed Regulatory Approach, Regulations, Notices and Guidelines for DTSPs under the Financial Services and Markets Act 2022.
From 30 June 2025, providers of digital token services involving digital payment tokens or capital market product tokens that cater exclusively to customers outside of Singapore will need to be licensed.
MAS has set a high standard for licensing and stated it will generally not grant licences to such businesses.
While such providers must apply for a licence, MAS indicated it will generally not grant one.
It cited higher money laundering risks and the difficulty in effectively supervising providers whose substantive regulated activities are conducted outside Singapore.
Without a license, these service providers will have to cease their regulated operations.
There is no change for providers that serve customers within Singapore.
These firms are already subject to regulation under existing laws such as the Payment Services Act, the Securities and Futures Act, or the Financial Advisers Act, and they can continue to provide services to both local and overseas customers.
The new licensing regime does not affect providers of services for other tokens, such as those used only for utility and governance.
Existing service providers that only serve customers outside of Singapore will be required to stop this activity when the regime takes effect on 30 June.
MAS stated that its position has been consistently communicated since its first consultation response on 14 February 2022, as well as in follow-up publications on 4 October 2024 and 30 May 2025.
The authority has reached out to the small number of known providers likely to be affected to discuss their plans for an orderly wind-down of operations.
Service providers who may be affected can contact MAS via AMLCFT@mas.gov.sg.
Relevant legislative provisions are outlined in the annex, including definitions under Sections 136 and 137 of the Financial Services and Markets Act 2022.
Featured image: Edited by Fintech News Singapore, based on image by EyeEm via Freepik
