Singapore Finalizes Stablecoin Regulatory Framework

Singapore's central bank has announced a revised regulatory framework aimed at guaranteeing stability for Singapore-regulated single-currency stablecoins (SCS).

The Singapore Monetary Authority announced the framework on August 15, which is aimed at non-bank issued stablecoins that are pegged to the value of the Singapore dollar or G10 currencies such as the euro, British pound, and US dollar and have a circulation of more than 5 million Singapore dollars ($3.7 million).

Ho Hern Shin, the bank's deputy managing director for financial supervision, stated that the framework aims to encourage stablecoin adoption "as a credible digital medium of exchange and as a bridge between the fiat and digital asset ecosystems."

According to MAS, the framework defines many standards for stablecoin issuers, including as redemption deadlines, disclosures, reserve management, and capital requirements:

Value stability: Reserve assets will be subject to requirements relating to their composition, valuation, custody and audit, to give a high degree of assurance of value stability.

Capital: Stablecoin issuers must maintain minimum base capital and liquid assets to reduce the risk of insolvency and enable an orderly wind-down of business if necessary.

Redemption at Par: Issuers must return the par value of the stablecoins to holders within five business days from a redemption request.

Disclosure: Issuers must provide appropriate disclosures to users, including information on the SCS’ value stabilizing mechanism, rights of SCS holders, as well as the audit results of reserve assets.

Sources:

https://cointelegraph.com/news/singapore-central-bank-releases-regulatory-framework-for-stablecoins

https://www.mas.gov.sg/news/media-releases/2023/mas-finalises-stablecoin-regulatory-framework

https://thedefiant.io/singapore-finalizes-regulatory-framework-for-stablecoins