Crypto Regulations in Singapore: Guide to Cryptocurrency Laws & Compliance for Investors

Singapore’s become a major player in the crypto world, thanks to its pretty balanced approach to digital asset regulation. The city-state has put together a framework that tries to encourage innovation, but it doesn’t let things get out of hand—consumer protection and crime prevention are front and center. If you’re running a crypto platform here, you’ll need a license under the Payment Services Act and you’ve got to meet strict anti-money laundering requirements by June 30, 2025.

The Monetary Authority of Singapore (MAS) keeps an eye on the crypto industry, mainly through the Payment Services Act 2019 and the Financial Services and Markets Act 2022. These laws mean crypto exchanges, wallet providers, and similar businesses have to meet the same standards as banks or other financial institutions. If you’re handling more than SGD 3 million a month, you’ll need a Major Payment Institution license. Smaller operators can settle for a Standard Payment Institution license.

This regulatory setup has drawn in over 2,000 blockchain companies and nearly $1 billion in merchant crypto payments. The rules cover everything from customer checks and transaction monitoring to cybersecurity and the travel rule. If you don’t play by the rules, you could face fines up to $200,000—or even criminal charges.

Key Takeaways

• You need an MAS license under the Payment Services Act to run a crypto platform in Singapore. The final compliance deadline is June 30, 2025.

  
  

• There are three license types based on your transaction volume. If you’re handling over SGD 3 million monthly, expect stricter requirements.

  
  

• Companies must set up solid anti-money laundering systems, verify customers, and monitor transactions to stay legal.

Key Regulatory Frameworks and Authorities

Singapore’s crypto regulations work through a web of frameworks, with the Monetary Authority of Singapore steering the ship. The Payment Services Act is the main law for digital payment tokens, but traditional securities laws can apply to some crypto assets, too.

Role of the Monetary Authority of Singapore (MAS)

MAS acts as Singapore’s central bank and the main regulator for crypto. It handles licensing for all crypto service providers and enforces compliance standards across the digital asset space.

MAS controls who can offer digital payment token services. It sets strict anti-money laundering requirements and has tough consumer protection standards. Licensed companies have to keep 90% of customer funds in offline cold wallets—no shortcuts.

The regulator tries to strike a balance: it wants to encourage innovation but doesn’t want financial chaos. MAS updates its guidelines regularly to keep up with new risks in crypto. It also works with international regulators to make sure Singapore’s standards match up globally.

For 2025, MAS has ramped up its oversight. Now, licensed operators have to run even more thorough checks and be more transparent.

Payment Services Act (PSA) and Digital Payment Tokens

The Payment Services Act is Singapore’s main law for crypto activities. It specifically covers digital payment token services and spells out who needs a license.

The PSA defines digital payment tokens as digital value you can transfer electronically. It covers a bunch of services, including e-money issuance, account services, and cross-border money transfers.

Licensed companies fall into several categories:

• Standard Payment Institution: For lower transaction volumes

  
  

• Major Payment Institution: For bigger players

  
  

• Domestic money transfer service: Local transfers only

  
  

• Merchant acquisition service: Payment processing for businesses

  
  

• Money-changing service: Currency exchange

From the first dollar, you have to verify your customers. If you’re dealing with higher-risk clients or transactions, you have to monitor things even more closely.

Securities and Futures Act (SFA) and Commodity Trading Act

The Securities and Futures Act kicks in if your crypto counts as a security under Singapore law. This covers assets like ownership interests, debt instruments, or investment contracts.

If your token is a security, you have to follow the same rules as any other financial product. That might mean publishing prospectuses or meeting disclosure requirements. If you’re trading security tokens, you’ll need a different license than if you’re just handling payment tokens.

The Commodity Trading Act looks after crypto derivatives and futures contracts. It’s there to make sure exchanges offering crypto futures manage risks and keep markets fair. If you’re offering these products, you’ll need MAS approval.

The Financial Services and Markets Act adds another layer, covering gaps around market conduct and systemic risk.

Licensing Categories and Requirements

MAS splits licenses by transaction volume and services. Standard Payment Institutions handle smaller volumes. Major Payment Institutions are for the big guys.

Standard Payment Institution requirements:

• Annual transaction volume under S$3 million for e-money

  
  

• Under S$3 million for domestic transfers

  
  

• Lighter compliance requirements

Major Payment Institution requirements:

• Higher transaction thresholds

  
  

• Tougher capital requirements

  
  

• Stricter governance

  
  

• More advanced risk management

Licensed companies have to keep customer funds in separate trust accounts and do daily account reconciliations. Custody teams can’t be mixed up with trading operations.

All license holders have to keep up with regular reporting, audits, and any new MAS guidelines.

Compliance, Consumer Protection, and Emerging Trends

Singapore’s rules put a lot of weight on anti-money laundering and counter-terrorism financing. There’s also a big focus on consumer protection, especially as the crypto scene keeps evolving.

Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT)

If you’re offering digital payment token services, you’ve got to build a strong AML and CFT framework under the Payment Services Act. That’s the foundation of Singapore’s crypto regulation.

Customer Due Diligence (CDD) means:

• Verifying every customer’s identity

  
  

• Doing extra checks for high-risk clients

  
  

• Keeping an eye on transactions

  
  

• Holding onto records for at least five years

VASPs need to run solid KYC checks before onboarding anyone. Use trustworthy documents and data sources to confirm identities.

If you spot something fishy, you have to file a Suspicious Transaction Report (STR) with the authorities. Providers have to report anything that looks off.

Operators must keep transaction records and customer info. They need systems in place to catch and stop money laundering.

Consumer Protection and Digital Asset Safeguards

Consumer protection for retail investors is rolling out in two phases through 2025. The first phase is all about asset protection; the second, risk awareness.

By October 2025, firms must:

• Keep customer assets separate (ring-fencing)

  
  

• Disclose more information to customers

  
  

• Tighten up risk controls

  
  

• Make sure company funds and customer funds aren’t mixed

Starting June 2025, licensed crypto firms can’t offer incentives to retail customers. The idea is to stop promotions that might nudge people into risky investments.

Retail investors can’t use credit, leverage, or derivatives. These products are just too risky with crypto’s wild price swings.

By June 19, 2025, all retail customers have to complete a risk awareness assessment. Even existing customers need to do this to keep using services.

Firms must do these assessments no matter where the customer lives, unless there’s a specific exemption.

Obligations for Virtual Asset Service Providers (VASPs)

Licensed DPT service providers have a lot on their plate beyond just AML/CFT. The goal is to keep operations solid and customers protected.

Key VASP obligations:

• Keep enough capital in reserve

  
  

• Set up good cybersecurity defenses

  
  

• Build strong governance structures

  
  

• Report regularly to regulators

Providers have to separate customer digital assets from their own. That way, if something goes wrong, customer funds are safer.

Tech risk management covers system security, data protection, and business continuity. You need backup plans and recovery systems.

Audit and compliance teams have to work independently. Regular internal and external audits help keep everyone honest.

For customer complaints, you need a formal process and have to resolve issues quickly. Keep records of complaints and how you handled them.

Additional Considerations: Stablecoins, Mining, and Payments

Stablecoin rules focus on having enough reserves and clear redemption processes. Issuers have to back tokens with quality liquid assets and report transparently.

Crypto mining isn’t ignored either—big mining operations need to think about energy efficiency and the environment. Large-scale miners might need extra permits.

Crypto payments involve:

• Monitoring cross-border transactions

  
  

• Managing settlement risks

  
  

• Linking up with traditional payment systems

  
  

• Following payment service regulations

If you’re using blockchain for things beyond crypto, you might fall under other rules. It’s up to each company to figure out what applies.

Tax-wise, IRAS expects you to report crypto transactions and gains. Keep detailed records for tax compliance.

Frequently Asked Questions (FAQs)

Singapore’s crypto rules are strict: you need a license, you have to fight money laundering, and you’ve got to handle taxes properly. The MAS enforces these through the Payment Services Act and the Financial Services and Markets Act.

What are the licensing requirements for cryptocurrency exchanges in Singapore?

If you run a crypto exchange in Singapore, you need a Digital Token Service Provider (DTSP) license under the Financial Services and Markets Act 2022. This rule applies to any Singapore-based company offering digital token services to overseas clients.

The deadline’s June 30, 2025—no extensions. You either get licensed or you have to stop all cross-border crypto business, period.

MAS requires at least SGD 250,000 in base capital for DTSP applications. You need to keep this as cash or a capital contribution for as long as you’re licensed.

DTSP covers businesses handling token transfers, exchanges between crypto and fiat, custody, and promoting token services. Even small or part-time crypto ventures have to comply.

MAS has said it’ll only issue licenses in very limited cases, mostly because of concerns about money laundering and terrorism financing. Getting approved isn’t easy.

How does the Payment Services Act impact the regulation of digital payment tokens?

The Payment Services Act sets the rules for digital payment tokens in Singapore. It makes service providers follow operational and security standards.

Under the Act, you have to run solid anti-money laundering and KYC checks for all digital payment token transactions.

There are also capital and operational requirements. You need enough financial resources and real risk management systems.

If you break the rules, MAS can hit you with big penalties. They monitor compliance closely and aren’t shy about enforcement.

What measures has the Monetary Authority of Singapore taken to prevent money laundering and terrorism financing in the cryptocurrency space?

MAS has rolled out detailed anti-money laundering and counter-terrorism financing rules for all crypto service providers. That means mandatory customer checks and transaction monitoring.

Licensed providers have to report any suspicious transactions. They also need to keep thorough records of all crypto activity and customer interactions.

MAS expects companies to set up strong compliance programs, run regular audits, and train staff. These programs have to address the unique risks of crypto.

If you don’t comply, MAS can revoke your license and even press criminal charges against company execs.

Are Initial Coin Offerings (ICOs) regulated under Singaporean financial law, and if so, how?

ICOs in Singapore fall under securities law if the tokens count as securities. It depends on the token’s features and what rights it gives.

Tokens that give ownership, profit-sharing, or act as investment contracts usually get treated as securities. Those offerings have to follow prospectus and investor protection rules.

Utility or governance tokens might be exempt if they’re just for using a platform or voting. Still, issuers need to check the legal status of their tokens carefully.

MAS reviews each ICO individually, looking at token function, investor expectations, and the economic reality.

What are the tax implications for trading and investing in cryptocurrencies in Singapore?

If you’re an individual investor in Singapore, you usually don’t pay capital gains tax on crypto. That goes for long-term holds and occasional trades.

But if you’re trading frequently or running a crypto business, you might owe income tax. It depends on how often you trade and whether it’s really a business.

Crypto trading or mining companies have to pay corporate income tax on profits. They must keep good records and report crypto income on tax returns.

Goods and Services Tax (GST) might apply to some crypto transactions, especially if you’re providing services. Each business needs to check its GST obligations based on what it does.

How does Singapore's regulatory stance on cryptocurrencies compare to other major financial markets globally?

Singapore's taken a noticeably stricter approach to crypto regulation than many other big financial hubs in 2025. Now, anyone wanting to run most crypto-related businesses there needs to get a comprehensive license.

That’s pretty different from places like Panama, Hong Kong, or Dubai, where regulators keep things more flexible. It’s no surprise a lot of crypto companies have packed up and moved to these friendlier markets.

Singapore really leans into anti-money laundering rules, even more than a bunch of other major markets. Authorities there seem to care more about financial stability and keeping a close eye on things than about chasing rapid market growth.

The country’s tough licensing rules and high capital requirements stand out compared to the more relaxed vibe in Thailand or the Philippines. Those countries have rolled out easier crypto policies that make life simpler for both businesses and regular folks.