A practical guide to MAS's stablecoin framework for SGD-pegged SCS issuers — covering licences, reserve rules, capital requirements, and who qualifies.

Singapore has one of the most clearly defined stablecoin regulatory frameworks in Asia, and it treats SGD-pegged tokens with particular attention. If you are considering issuing a stablecoin pegged to the Singapore Dollar, the regulatory path runs through the Monetary Authority of Singapore (MAS) and the Payment Services Act (PSA) — and the specific requirements depend heavily on your issuer type and the total value of coins in circulation.

This article explains how MAS regulates SGD-pegged single-currency stablecoins (SCS), what licence you need, what conditions you must meet to use the “MAS-regulated stablecoin” label, and where the framework stands today from a legislative perspective.

What Is an SGD-Pegged Stablecoin?

A stablecoin is a digital payment token whose value is fixed against a reference asset — in this case, the Singapore Dollar. For every token in circulation, a corresponding amount of SGD (or an equivalent high-quality liquid asset) is held in reserve. This 1:1 backing is what separates regulated stablecoins from speculative crypto assets.

MAS formally defines stablecoins as digital payment tokens designed to maintain a constant value against one or more specified fiat currencies. When properly backed and regulated, they can serve as a medium of exchange and a bridge between traditional fiat systems and on-chain financial activity.

How MAS Classifies Stablecoins Under the PSA

Under the Payment Services Act, stablecoins are treated as digital payment tokens (DPTs). This means any entity issuing or facilitating the use of stablecoins in Singapore must hold a PSA licence — either a Standard Payment Institution (SPI) licence or a Major Payment Institution (MPI) licence, depending on scale.

MAS draws a further distinction within that DPT classification. Stablecoins pegged to SGD or a G10 currency and issued in Singapore are eligible to be designated as Single-Currency Stablecoins (SCS) — a higher-trust classification with its own dedicated framework and the ability to carry the “MAS-regulated stablecoin” label.

Stablecoins that fall outside the SCS scope — those pegged to non-G10 currencies, multi-currency baskets, or issued outside Singapore — remain under the standard DPT regime. Some may also be assessed under the Securities and Futures Act if they carry the characteristics of securities.

The SCS Framework: What It Covers and What It Does Not

MAS finalized its Single-Currency Stablecoin (SCS) regulatory framework on 15 August 2023, following a public consultation launched in October 2022. The framework is specifically designed to ensure a high degree of value stability for stablecoins issued within Singapore’s jurisdiction.

The framework covers:

• Single-currency stablecoins pegged to SGD or any G10 currency (e.g., USD, EUR, JPY)
• Issued in Singapore by a Singapore-incorporated or Singapore-based entity
• With a total value in circulation exceeding S$5 million (for the full SCS framework to apply)

The framework does not cover:

• Stablecoins pegged to non-G10 currencies
• Multi-currency basket stablecoins
• Stablecoins issued outside Singapore
• Tokenized bank liabilities (though MAS reserves the right to impose additional requirements on these in the future)
• Non-bank issuers with SCS in circulation below S$5 million (these remain under the standard DPT regime only)

It is important to note that stablecoins outside the SCS framework can still circulate and be used in Singapore — they simply cannot carry the “MAS-regulated stablecoin” label.

Who Can Issue an SGD-Pegged Stablecoin in Singapore

MAS distinguishes between two categories of issuers: banks and non-banks. The compliance pathway differs meaningfully between them.

Non-Bank Issuers

For non-bank entities, the threshold that triggers the SCS framework is a total value of SCS in circulation exceeding S$5 million. Once that threshold is crossed:

• The issuer must obtain a Major Payment Institution (MPI) licence under the PSA.
• The MPI licence must specifically cover both the DPT service activity and the new “Stablecoin Issuance Service” activity.
• The issuer becomes subject to all SCS framework requirements and may apply to have its tokens labelled as “MAS-regulated stablecoins.”

Non-bank issuers with SCS in circulation at or below S$5 million are exempt from the SCS framework. They may continue to operate under a standard DPT service licence, but they cannot use the “MAS-regulated stablecoin” designation — and any misrepresentation of that status can result in penalties, including fines or imprisonment for individuals.

Bank Issuers

Banks are treated separately. A bank issuing SGD-pegged or G10-pegged stablecoins does not need to obtain a PSA licence specifically for the Stablecoin Issuance Service. However, banks must still comply with MAS’s guidelines for SCS issuance. MAS also retains the flexibility to classify bank-issued tokens as SCS if those tokens are designed to meet standards equivalent to the SCS framework.

Key Requirements for MAS-Regulated Stablecoin Status

To be recognized and labelled as an “MAS-regulated stablecoin,” a non-bank issuer must satisfy the following conditions across four broad categories:

1. Reserve Assets

• Reserve assets must at all times equal at least 100% of the par value of SCS in circulation.
• Eligible reserve assets include cash, cash equivalents, and short-dated government debt (up to three-month maturities).
• Monthly independent attestations of reserve adequacy must be published.
• Annual independent audits are required.

2. Segregation and Custody of Reserve Assets

• Reserve assets must be held separately from the issuer’s own operating funds.
• They must be held with MAS-approved custodians — typically licensed financial institutions or banks.
• Customer assets are subject to a statutory trust, providing holders with a direct claim on the reserves.

3. Capital and Solvency

• Minimum base capital for SCS issuers under the SCS framework: the higher of S$1 million or 50% of annual operating expenses.
• Note: This SCS-specific capital requirement is higher than the general MPI base capital of S$250,000, reflecting the elevated prudential standards MAS applies to stablecoin issuers.
• Issuers must maintain sufficient capital buffers above the minimum, accounting for operational risk and growth.

4. Redemption Rights

• Holders must be able to redeem SCS at par value within five business days of a valid redemption request.
• No unreasonable fees or conditions may be placed on redemptions.

5. Disclosure and Whitepaper

• Issuers must publish a whitepaper detailing: the SCS value-stabilization mechanism, technology used, rights of SCS holders, associated risks, and audit results for reserve assets.
• Ongoing disclosure obligations apply throughout the token’s life cycle.

6. Business Restrictions

• SCS issuers operating under the MAS framework are restricted to stablecoin issuance activities.
• Lending, staking, or engaging in unrelated commercial ventures is not permitted for regulated issuers.
• Users of MAS-regulated stablecoins are similarly restricted from high-risk activities such as staking or lending with those tokens.

7. Singapore-Only Issuance

• Under the 2023 framework, MAS-regulated stablecoins must be issued from Singapore.
• Consultation P015-2026 proposes limited recognition of certain foreign-issued tokens and jointly issued structures.
• Until that consultation is finalised, Singapore-only issuance remains the operative requirement for the label.

In addition to these SCS-specific conditions, all regulated issuers remain subject to MAS’s standard AML/CFT requirements and technology risk management guidelines that apply to all licensed payment service providers. For a deeper look at compliance program design, see GSS Legal’s AML & Compliance services.

Real-World Example: StraitsX and XSGD

The clearest illustration of the SCS framework in practice is StraitsX and its Singapore Dollar stablecoin, XSGD. StraitsX holds MPI licences issued by MAS and is widely cited as the first SGD-pegged stablecoin issuer to align its operations with the emerging SCS framework.

XSGD is pegged 1:1 to the Singapore Dollar and is fully backed by reserves held with DBS Bank and Standard Chartered. For every XSGD token in circulation, one Singapore Dollar sits in a segregated reserve account at one of those banks. StraitsX has also positioned XSGD as substantially aligned with the SCS framework’s published requirements, ahead of the framework’s formal legislative enactment — a significant market signal in a jurisdiction where regulatory credibility matters to institutional counterparties.

This example illustrates a key commercial reality: the “MAS-regulated stablecoin” label is not merely a compliance checkbox. It signals institutional-grade trust — making regulated SGD stablecoins viable for cross-border settlement, on-chain FX, and programmable payment infrastructure across Southeast Asia.

Current Status: Finalized Policy, Pending Legislation

The SCS framework was finalized in August 2023 as policy, but it is not yet operative legislation as of mid-2026. This distinction matters for compliance planning.

At the Singapore FinTech Festival in November 2025, MAS Managing Director Chia Der Jiun confirmed that MAS would draft stablecoin-specific legislation in 2026, with the framework expected to take effect around mid-2026. As of the time of writing, the SCS-specific statutory regime has not yet been enacted, and issuers continue to operate under the existing PSA requirements applicable to their licensed activities.

What this means practically:

• A prospective issuer cannot structure its licensing or capital plan around the 2023 finalized policy document as though it were operative law.
• Existing PSA obligations — including DPT service licensing, AML/CFT compliance, and MPI capital requirements — apply in full today.
• Issuers who begin preparations now (governance, reserve infrastructure, capital adequacy, custodian arrangements) will be better positioned when the legislation takes effect.
• Any issuer seeking to use the “MAS-regulated stablecoin” label without meeting the framework’s requirements is exposed to regulatory sanction and placement on MAS’s Investor Alert List.

What This Means for Prospective Issuers

For any entity considering issuing an SGD-pegged stablecoin in Singapore, the regulatory pathway is becoming clearer — even if the final legislation is pending. The framework architecture is known, the licence type is identifiable (MPI with Stablecoin Issuance Service), and the substantive requirements have been published.

Key decision points for prospective issuers include:

• Issuer type: Are you a bank or a non-bank entity? The compliance path and licence obligations differ.
• Scale threshold: Will your SCS in circulation exceed S$5 million? If yes, an MPI licence is mandatory and the full SCS framework applies.
• Jurisdiction of incorporation: You must be incorporated and operate from Singapore to issue MAS-regulated SCS.
• Reserve infrastructure: Custodian arrangements with MAS-approved institutions must be in place before launch, not after.
• Capital adequacy: You must satisfy the higher SCS-specific capital requirement (S$1 million or 50% of annual operating costs, whichever is higher), not just the standard MPI base capital.
• Business scope restrictions: The issuer entity must be ring-fenced for stablecoin issuance. Unrelated commercial activities must be separated into different legal entities.

Singapore’s approach — high standards, a meaningful label, and institutional backing infrastructure — makes the MAS-regulated stablecoin a credible product for institutional counterparties globally. Preparation now, before the legislation takes effect, is the practical path forward.

For more on Singapore’s licensing environment and how Crypto & VASP licensing intersects with stablecoin issuance, or for guidance on the overall jurisdiction selection process, GSS Legal’s advisory practice covers the full regulatory pathway — from entity structure and licence application through to go-live and ongoing compliance.

Summary

Singapore’s MAS has built one of the most structured stablecoin regulatory frameworks in Asia. For SGD-pegged stablecoins specifically, the framework imposes clear requirements: full reserve backing at 100%, segregated custody with approved institutions, MPI licensing for non-bank issuers above the S$5 million threshold, a minimum capital requirement of S$1 million or 50% of annual operating costs (whichever is higher), par-value redemption within five business days, and Singapore-only issuance at the initial stage.

The framework has been finalized as policy since August 2023. Legislation to give it full legal effect is expected around mid-2026. Prospective issuers who treat this preparation window seriously — working through entity structure, reserve infrastructure, custodian selection, and AML/CFT program design now — will be positioned to move quickly once the operative regime takes effect.