Singapore Orders Cryptocurrency Companies to End International Operations by June 30th
Singapore Cracks Down on Cryptocurrency Service Providers with New Regulatory Directive
The Monetary Authority of Singapore (MAS) has announced a new regulatory directive targeting Digital Token Service Providers (DTSPs) operating in Singapore. By June 30, 2025, all DTSPs must obtain a license under the Financial Services and Markets (FSM) Act, and any entities or individuals offering digital token services overseas must comply with the new regulations to avoid significant fines and regulatory action.
The new directive imposes stringent compliance obligations, including robust Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) protocols, customer due diligence, suspicious transaction reporting, daily reconciliation, segregation of client assets, and annual audits. The MAS has classified Virtual Asset Service Providers (VASPs) as medium-high risk, and a minimum base capital of SGD 250,000 is required for certain entities to qualify for licensing.
This regulatory update marks a significant tightening of Singapore's cryptocurrency landscape, aimed at mitigating risks and enhancing safeguards around digital token services and VASPs. The MAS's move comes in response to global cryptocurrency risks and previous high-profile industry failures.
Notably, the MAS has not indicated any plans to implement the suggested measures for a transitional period, temporary exemption, or expedited review process for simple business models or applicants that are regulated in other jurisdictions. Additionally, no grace period will be offered to local DTSPs currently serving international clients.
The MAS has clarified that digital token service providers serving solely overseas customers without a Singapore presence may have different regulatory considerations but must still comply with applicable rules. The penalties outlined in the new directive remain unchanged, with fines of nearly $200,000 for non-compliance.
The MAS reiterated its cautious stance toward DTSPs, citing heightened money laundering and terrorist financing risks due to the cross-border nature of their operations. Only firms already licensed or exempted under existing financial regulations will be allowed to continue operating without violating the new framework.
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The new regulations will require Digital Token Service Providers (DTSPs) in Singapore to comply with stringent security measures, such as implementing robust Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) protocols. The Monetary Authority of Singapore (MAS), in its new directive, classifies Virtual Asset Service Providers (VASPs) as medium-high risk, and imposes financial penalties for non-compliance, reaching nearly $200,000.
