The Monetary Authority of Singapore (MAS) has established new regulations for stablecoins to increase stability within the city-state.
- The regulations are applicable to single-currency stablecoins pegged to the Singapore Dollar or other G10 currencies.
- Key requirements for stablecoin issuers include maintaining adequate reserve assets, a minimum capital base, and liquid asset requirements.
- Issuers must be able to promptly return the par value of stablecoins to holders within five business days upon redemption request.
- Stablecoin issuers that meet all requirements can apply for recognition as “MAS-regulated stablecoins.”
- Other types of stablecoins will not be prohibited in Singapore and will be subject to existing regulations.
Hot Take
The new regulations by MAS aim to bring stability to the growing stablecoin market in Singapore. By implementing requirements such as reserve assets and prompt redemption, the framework ensures that stablecoin issuers prioritize stability and reduce the risk of insolvency. This move by MAS is a step towards facilitating the use of stablecoins as a credible digital medium of exchange and bridging the gap between fiat and digital assets in Singapore. The regulator also acknowledges the importance of monitoring developments in the stablecoin landscape and may expand the regulatory framework to include other types of tokens.
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