MAS Consults on Legislative Amendments to Implement Stablecoin Regulatory Framework

Key Takeaways

• MAS has published a consultation paper proposing amendments to the Payment Services Act 2019 to formalize its Single-Currency Stablecoin (MAS-SCS) framework, covering licensing, value stability, capital, redemption, and disclosure requirements.
• Compliance teams at financial institutions engaging with stablecoins, digital payment tokens, or tokenized asset markets in Singapore should review the proposals closely, as they will determine who can market stablecoins as "MAS-regulated" and set new safeguards for issuers and intermediaries.
• Comments are due by October 16, 2026.

Deep Dive

This consultation represents a significant step in Singapore's effort to formalize stablecoin regulation under the existing PS Act framework rather than creating entirely new legislation. For compliance teams, this signals that stablecoin issuance, distribution, and related services will soon fall under a more defined regulatory perimeter, with clear distinctions drawn between MAS-regulated stablecoins and other Digital Payment Tokens (DPTs). Institutions currently offering or planning to offer stablecoin-related products in Singapore should assess whether their current or prospective activities would fall within scope of the MAS-SCS framework.

Key requirements introduced include value stability mechanisms, capital adequacy standards, redemption at par guarantees, and enhanced disclosure obligations. Notably, MAS is proposing a prohibition on interest payments for MAS-regulated stablecoins, mandatory stress testing, and recovery/wind-down planning—requirements reminiscent of prudential banking standards. The consultation also addresses more complex scenarios such as multi-jurisdictional issuance (joint Singapore-foreign issuer arrangements) and mutual recognition of foreign-issued stablecoins under comparable regulatory regimes, which has implications for cross-border treasury, settlement, and correspondent banking functions. Additional consumer protection safeguards, including safeguarding of customer funds prior to stablecoin issuance, mirror existing PS Act licensee obligations and will require operational and custodial process reviews.

The consultation period is open until October 16, 2026, giving affected institutions approximately six weeks to submit feedback via FormSG. Compliance, legal, and product teams should coordinate to assess the practical impact of these proposals on existing or planned stablecoin offerings, licensing strategies, and cross-border partnerships. Firms with multi-jurisdictional stablecoin ambitions should pay particular attention to the proposed framework for joint issuance and foreign stablecoin recognition, as these provisions could materially affect market entry strategies and compliance architecture.

From a risk perspective, this is a precursor to binding legislative change—institutions should begin gap analysis now rather than waiting for final rules. Failure to engage during the consultation period may result in frameworks poorly suited to institution-specific business models. Firms should also monitor how the "MAS-regulated stablecoin" label requirement could affect marketing, disclosure, and competitive positioning, particularly where non-compliant tokens may be reclassified as DPTs with different regulatory treatment.

Source: Monetary Authority of Singapore