Singapore regulates crypto on an activity basis. If you provide payment or digital payment token (DPT) services to customers in Singapore, you fall under the Payment Services Act (PSA). If a Singapore entity provides digital token services to overseas customers, the Digital Token Service Provider (DTSP) regime under the Financial Services and Markets Act (FSMA) Part 9 applies (effective 30 June 2025). If your token is a capital markets product (e.g., equity, debt, or units in a CIS), the Securities and Futures Act (SFA) governs.
Operating without the required DTSP license can lead to penalties of up to SGD 250,000 and/or three years’ imprisonment.
This guide explains how to choose the right license, prepare your application, and meet ongoing obligations.
TL;DR
- Licenses are issued by the Monetary Authority of Singapore (MAS) across PSA (payment/DPT services), FSMA (DTSP), and SFA (capital-markets products).
- Identify your activities and token classification (DPT, e-money, or capital-markets product) to determine the applicable regime.
- The licensing process tests fit-and-proper, governance, capital, AML/CFT, custody, and technology-risk controls – admitting well-prepared, adequately capitalized applicants.
What Laws Apply To Crypto Businesses?
Singapore’s crypto framework is activity-based, i.e., different rules apply depending on what a company does, what type of tokens are dealt with, and who its customers are.
The main types of activity covered by Singapore’s licensing regime include:
- Buying, selling, and exchanging cryptocurrencies.
- Managing international remittances.
- Processing local fund transfers.
- Facilitating merchant payments.
- Issuing digital currency for transactions.
- Issuing payment accounts and e-wallets.
MAS oversees all financial activity in Singapore under three main laws.
Payment Services Act (PSA)
The PSA applies to businesses serving customers in Singapore, such as crypto exchanges, wallets, and payment providers. It sets standards for AML/CFT compliance, consumer protection, and operational risk management. Most local crypto companies need a payment services license.
Financial Services and Markets Act (FSMA)
The FSMA requires all Singapore-based companies offering digital token services, locally and globally, to obtain a DTSP license. Licenses are rarely granted to applicants serving only overseas customers, to prevent businesses from using Singapore’s reputation to run loosely regulated offshore operations.
Securities and Futures Act (SFA)
This is the main rulebook for digital tokens functioning as securities (shares, bonds, or collective investment units). Issuers or platforms dealing in these tokens must meet the SFA’s licensing and prospectus requirements.
DPT vs. E-Money vs. Security Token
The applicable law can vary depending on what a token represents. MAS does not consider what a token is called, but instead assesses the token’s features and the rights of holders.
- Digital Payment Token (DPT): A digital representation of value that is not pegged to any fiat currency, e.g., $BTC, $ETH. All DPT services are supervised by MAS under the PSA.
- E-Money: A digital token pegged to fiat currency (this includes most stablecoins, e.g., USDT). Tokens pegged to the Singapore dollar or a G10 currency can qualify as MAS-regulated stablecoins if they meet strict reserve and redemption standards.
- Security Token: A digital representation of ownership, such as equity in a company, a share of profits, or title to a real-world asset. Examples include tokenized equity or fractional real estate shares. These are covered by the SFA.
Choosing Your License: SPI vs. MPI
The PSA offers two main types of payment service licenses based on the scale of business.
Standard Payment Institution (SPI) License: Lower capital requirements favor smaller operators, but monthly transaction volume and maximum balance sheet amounts are capped.
Major Payment Institution (MPI) License: There are no transaction limits, making this suitable for businesses that expect to exceed the SPI thresholds, but MPI licenses come with higher capital requirements and stricter regulatory obligations.
Applying For A Singapore Crypto License
The MAS license application process is strict, but straightforward.
- Corporate setup: Incorporate the company in Singapore and maintain a physical office.
- Governance structure: At least one executive director must be a Singapore citizen or resident. All directors, the CEO, and major shareholders must pass MAS background checks for integrity, competence, and financial soundness.
- Compliance & auditing: A Singapore-based compliance officer must be hired. Applicants must present evidence of their ability to conduct annual independent financial audits.
- Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) framework: Maintain a full AML/CFT program compliant with MAS Notice PSN02, covering the Travel Rule, Know-Your-Customer (KYC), transaction monitoring, and suspicious activity reporting.
- Base capital & security deposit: Deposit the required minimum operational capital, and where applicable, make a security deposit with MAS.
- Technology & security: Carry out penetration testing, remediate all high-risk vulnerabilities, and implement a technology risk management framework that aligns with MAS Notice FSM-N13.
Application Process & Timeline
Pre-Application Phase (Approx. 2–6 weeks)
- Incorporate a company in Singapore and open a local corporate bank account.
- Secure a physical office.
- Hire essential personnel, including a resident director and an in-house compliance officer.
Document Checklist
Follow these steps to prepare a complete and accurate application package.
- Obtain a letter of responsibility, where appropriate.
- Create infographics detailing the end-to-end transaction flow, including fee splits and the use of any innovative technology.
- Create a business plan outlining services, target markets, fund flows, and three-year financial projections.
- Submit application Form 1 via the MAS e-licensing portal.
- Obtain a legal opinion from a Singapore-based law firm providing a summary of all proposed services and products.
- Obtain an independent review of AML/CFT and consumer protection controls, issued within three months of submission.
- Compile board-approved manuals for AML/CFT, technology risk management, and internal controls.
MAS Review & Interview (Approx. 3–12 months)
- A case officer reviews each file and issues multiple rounds of questions. Applicants are expected to respond promptly and accurately.
- MAS will interview key executives (e.g., CEO, CCO), but external advisors cannot attend these screenings.
- Failure to anticipate and communicate major business or leadership changes may result in a six-month hold or outright rejection.
Post-Licensing Obligations
Receiving a Singapore crypto license marks the beginning of ongoing regulatory oversight by MAS.
- Customer asset protection: Segregate all client assets in trust accounts. Keep at least 90% of customer assets in cold storage and reconcile all balances daily.
- Reporting & audits: Submit regular reports to MAS and complete annual independent audits of financials and compliance.
- AML/CFT monitoring: Continuously review transactions, detect suspicious activity, and file Suspicious Transaction Reports (STRs) in compliance with MAS Notice PSN03.
- Marketing restrictions: Limit all advertisements of DPT services to the official website and official social channels.
- Annual licensing fees: Pay the annual license fee of SGD 10K.
Benefits of a Singapore Crypto License
A Singapore crypto license delivers strategic benefits to companies that are well-prepared to comply with the strict regulations.
- Credibility and trust: It serves as a global seal of compliance and reliability, reinforcing confidence among customers, investors, and partners.
- Regulatory certainty: Singapore provides a stable, transparent framework that enables long-term planning and mitigates regulatory risk.
- Access to Southeast Asian markets: Establishing a base in Singapore opens doors to institutional investors, venture funds, and banking partners restricted from engaging with unlicensed firms.
- Favorable business environment: Singapore’s economic policies offer advantages, including low corporate tax, zero capital gains tax, and strong government support for innovation.
Conclusion
Singapore’s licensing regime aims to balance progressive regulation with strong institutional safeguards that protect investors and customers, under a uniform supervisory authority.
For crypto businesses, this means operating in an environment that prizes transparency, compliance, and trust. Securing a MAS license can be time-consuming and resource-heavy, but it is a competitive advantage that offers access to a walled garden of attractive market opportunities.
