The Monetary Authority of Singapore has introduced a new regulatory framework aimed at enhancing the stability of certified stablecoins in the country.
The new guidelines will apply to single-currency stablecoins (SCS) that are pegged to the Singapore Dollar or any G10 currency and issued in Singapore. Issuers of these SCS must meet essential requirements concerning value stability, including details about their composition, valuation, custody, and auditing, as well as new capital requirements and redemption and disclosure rules.
These regulations are designed to ensure an orderly wind-down of failing stablecoin schemes and guarantee full value returns to investors. Only those stablecoin issuers that meet all the framework’s requirements will be able to apply to the Monetary Authority of Singapore for their stablecoins to be recognized and designated as “MAS-regulated stablecoins.” Any misrepresentation of this label could lead to financial penalties and imprisonment.
Ho Hern Shin, deputy managing director of MAS, stated, “MAS’ stablecoin regulatory framework aims to facilitate the use of stablecoins as a credible digital medium of exchange and as a bridge between the fiat and digital asset ecosystems. We encourage SCS issuers who wish to have their stablecoins recognized as ‘MAS regulated stablecoins’ to prepare for compliance early.”