The Monetary Authority of Singapore (MAS) has announced new strict rules for crypto companies offering overseas services.
Strict Compliance or Severe Penalties
Under the Financial Services and Markets Act (FSM Act 2022), any Singapore-based entity, including individuals, businesses, and partnerships, providing digital token (DT) services to overseas users must either obtain a Digital Token Service Provider (DTSP) license or cease overseas operations immediately. Non-compliance with these new guidelines will lead to severe penalties: fines of up to 250,000 SGD (approximately 200,000 USD) and imprisonment for up to 3 years.
Key Takeaways from MAS New Guidelines
Key points of the new MAS regulations include:
- No Grace Period: Existing service providers will not receive time for a smooth transition. The deadline is set for June 30, 2025.
- License Exemptions: Entities already licensed under the Securities and Futures Act, Financial Advisors Act, or Payment Services Act are exempt from the new licensing requirements.
- Strict AML/CFT Conditions: Only those companies with strong anti-money laundering (AML) and counter-financing of terrorism (CFT) measures will be eligible for the new DTSP license.
Reasons for This Initiative
The MAS aims to eliminate regulatory arbitrage, where crypto firms use Singapore as a legal base while operating freely in foreign markets without proper oversight. This move is part of Singapore's broader plan to strengthen financial integrity, protect its global reputation, and prevent misuse of its crypto-friendly image.
With the new rules being implemented by MAS, Singapore is sending a strong message that crypto regulation must be respected both locally and globally.
