Singapore proposes recognizing overseas stablecoins under new regulatory framework

BitcoinWorld

Singapore proposes recognizing overseas stablecoins under new regulatory framework

Singapore’s central bank has opened a public consultation on a proposal that could bring certain stablecoins issued jointly with overseas institutions or regulated abroad into its domestic regulatory net. The Monetary Authority of Singapore (MAS) is seeking feedback on a framework that would recognize some foreign stablecoins for use in cross-border wholesale transactions, provided they meet equivalent regulatory standards.

What the proposal entails

Under the plan, stablecoins jointly issued by Singaporean and overseas entities could be recognized as MAS-regulated if risks are sufficiently mitigated. The authority is also considering recognizing overseas stablecoins that are subject to equivalent regulation in their home jurisdictions, allowing them to be used for wholesale cross-border settlements.

The framework would apply to stablecoins under the Payment Services Act, requiring issuers to maintain 100% asset backing, meet minimum capital thresholds, and offer immediate one-to-one redemption. Interest payments on stablecoins would be banned, and issuers would need to conduct regular stress tests to ensure resilience.