MAS Proposes New Singapore Stablecoin Rules With Interest Ban And Cross-Border Recognition

Singapore is preparing to give its stablecoin market a clearer legal framework, with proposed rules that would determine which tokens can carry MAS regulatory recognition and how issuers must protect users and the wider financial system.

The Monetary Authority of Singapore (MAS) opened a public consultation on 1 September 2026 on legislative amendments to the Payment Services Act 2019, bringing its stablecoin framework first finalised in August 2023 closer to implementation.

MAS Sets Clear Rules For Regulated Stablecoins

The proposed framework would apply to single-currency stablecoins issued in Singapore and pegged to the Singapore dollar or a Group of Ten currency.

Only licensed issuers meeting the requirements would be allowed to describe their tokens as “MAS-regulated stablecoins” or market them using that designation.

Stablecoins outside the framework would continue to be classified as Digital Payment Tokens under Singapore’s existing rules and remain subject to applicable consumer protection measures.

The distinction is intended to make it easier for users and businesses to tell regulated stablecoins apart from other digital assets that claim to maintain a stable value.

Reserve Assets Would Need Full Backing

At the centre of the proposed regime are requirements designed to ensure regulated stablecoins can maintain their value and be redeemed when holders request it.

Issuers would be required to hold reserve assets worth at least 100% of their outstanding stablecoins at all times, with the reserves valued on a daily mark-to-market basis.

The assets would need to be liquid and carry low credit and market risk.

They would also have to be held in segregated accounts on trust, separate from the issuer’s own assets, and kept with licensed financial institutions in Singapore or comparable overseas jurisdictions.

Holders would have the right to redeem their stablecoins at par value within five business days.

Why Is MAS Proposing An Interest Ban?

MAS is also considering a ban on issuers paying interest or other benefits based on the amount of regulated stablecoins a customer holds.

The restriction would prevent stablecoins under the MAS framework from functioning like interest-bearing deposits while keeping their primary role focused on payments and settlement.

Alongside the proposed ban, MAS is considering mandatory stress testing for regulated issuers, as well as recovery and orderly wind-down plans to prepare for financial or operational difficulties.

Issuers would also need to protect customer money received before the corresponding stablecoins are issued.

Foreign Stablecoins Could Gain Limited Recognition

The proposed rules are not limited to tokens issued entirely within Singapore.

MAS is considering allowing stablecoins jointly issued by Singapore-based and foreign entities to qualify under the framework where the associated risks can be adequately managed.

It is also looking at recognising a limited number of foreign-issued stablecoins that operate under comparable regulatory regimes overseas.

The approach is particularly aimed at supporting cross-border wholesale use cases while maintaining safeguards around the assets and entities involved.

MAS has yet to settle how responsibilities would be divided for jointly issued tokens or exactly how recognition of foreign stablecoins would operate, with those details subject to feedback from the consultation.

Four Core Requirements Will Anchor The Framework

The proposed legislation would establish requirements covering reserve backing, redemption at par, capital and disclosure.

These requirements largely build on the framework MAS finalised in 2023, but putting them into legislation would give the obligations greater legal force.

MAS said the proposed amendments would provide “clear regulatory guardrails” for stablecoins that meet high standards of value stability and governance.

Ho Hern Shin, Deputy Managing Director (Financial Supervision) at MAS,

“Trusted and well-regulated stablecoins can serve as a credible settlement asset in tokenised financial markets, while mitigating risks to users and the broader financial system.”

MAS Sees Stablecoins As A Settlement Tool

The regulator is positioning the framework around the growing use of tokenised financial assets and digital settlement systems.

Ho said the proposed amendments would support responsible financial innovation as asset tokenisation gains traction, while ensuring stablecoins used in these markets are subject to safeguards covering their stability and governance.

The latest consultation follows MAS’ earlier work on stablecoin regulation, including its initial consultation on 26 October 2022 and its response to industry feedback published on 15 August 2023.

MAS is accepting feedback from industry participants, legal experts and the public until 16 October 2026 before the legislative amendments are finalised.