Singapore’s Central Bank Takes Action on Cryptocurrency Services
In a significant move to enhance regulatory oversight amid a rising interest in digital currencies, Singapore’s central bank has mandated that all local cryptocurrency service providers lacking a Digital Token Service Provider (DTSP) license must cease their international operations by June 30. This decision is part of Singapore’s wider initiative aimed at safeguarding its burgeoning retail cryptocurrency market, in light of increasing adoption among citizens.
Compliance Requirements for Cryptocurrency Providers
The Monetary Authority of Singapore (MAS) has clarified that only those applicants who have successfully secured a DTSP license under the Payment Services Act are authorized to engage in activities serving clients beyond Singapore’s borders. Those without this formal approval are strictly prohibited from continuing such practices.
Responding to industry feedback, MAS expressed concerns that unregulated international services could subject users to potentially exploitative situations and increase the likelihood of financial misconduct.
The authority has declined requests for a gradual implementation period, emphasizing that firms have been fully aware of the regulatory requirements since the initial consultation phase and should now be prepared to comply.
Universal Application of Regulations
Furthermore, MAS affirmed that this ban applies universally, whether services are offered directly or via third-party intermediaries. The agency warned that attempts to evade regulations—such as relocating operational aspects abroad while still managing them from Singapore—will be deemed as non-compliance.
Growing Interest in Cryptocurrency Among Singaporeans
This regulatory tightening coincides with a notable uptick in the adoption of digital assets among Singaporeans. According to a report by The Straits Times earlier this year, 26% of Singaporeans owned cryptocurrency in 2024, an increase from 24.4% in 2023. The trend is particularly pronounced among younger individuals, with nearly 40% of Gen Z and millennials asserting they own digital currencies.
Among those engaged in crypto, 52% have utilized digital tokens for transactions, while 67% expressed intentions to do so in the future for various purposes, including online shopping and bill payments. Older demographics predominantly prefer using crypto for peer-to-peer transfers, particularly in international contexts.
Challenges in the Cryptocurrency Market
Despite this growing interest, challenges persist. A survey revealed that over 60% of participants find cryptocurrency too complex, while 54% pointed to limited merchant acceptance as a key obstacle. Nevertheless, the volume of crypto transactions continues to rise, positioning Singapore as a critical player in Asia’s regulated digital finance landscape.
