MAS Weighs Recognizing Foreign-Issued Stablecoins in Oct. 16 Consultation

Singapore Opens the Door to Foreign Stablecoins

Singapore's central bank is preparing to accept stablecoins issued outside the city-state under its own regulatory umbrella for the first time. The Monetary Authority of Singapore (MAS) opened a public consultation on Tuesday setting out legislative amendments to implement its stablecoin framework, alongside policy proposals that reflect how the market has evolved since 2023. The most consequential shift concerns tokens issued across multiple jurisdictions: under one proposal, a stablecoin jointly issued by a Singapore-licensed issuer and a foreign issuer could be labeled a “MAS-regulated stablecoin,” provided the associated risks are demonstrably mitigated. MAS is also weighing recognition of a limited set of foreign-issued tokens already supervised under comparable overseas frameworks, a move aimed squarely at their potential use in cross-border wholesale settlement. The consultation reverses the regulator's 2023 stance, when it finalized a framework covering only single-currency stablecoins issued in Singapore and pegged to the Singapore dollar or a G10 currency. At the time, MAS cited two practical obstacles: the difficulty of establishing regulatory equivalence and cooperation arrangements with other jurisdictions, and the technical challenge of tracing where commingled stablecoins originated while verifying whether overseas reserves would be sufficient to honor redemption requests. For issuers that have structured multi-jurisdiction tokens to serve regional payments corridors — a design similar in spirit to the cross-border transfer rails built on networks like Stellar — the proposal would, if adopted, create a path to a nationally recognized label rather than the generic digital payment token classification. Our reading of the consultation paper is that MAS is responding to fait accompli market structure: multi-issuer stablecoins are already circulating, and the regulator is now deciding how to supervise them rather than whether they exist.

Reserve, Capital and Redemption Rules Under the PSA

The second pillar of the consultation is the legislative plumbing. The proposed amendments would write the 2023 stablecoin framework into the Payment Services Act (PSA), the primary statute governing payment services and their operators in Singapore. Issuers falling inside the dedicated framework would face four core obligations: maintaining reserve-backed value stability, meeting minimum capital requirements, honoring redemption at par, and meeting ongoing issuer disclosure duties. Only issuers licensed under the framework would be permitted to market themselves as MAS-regulated stablecoin issuers and to label their tokens accordingly — a branding gate that gives compliant issuers a marketable trust signal, not unlike how a fully reserved, savings-oriented product such as Savings Dai communicates its backing mechanics to holders. The proposals go further on issuer conduct than the 2023 framework did. MAS wants to prohibit issuers from paying interest on regulated stablecoins, a rule that removes any yield-bearing competition with bank deposits from the regulated category. Issuers would also be required to conduct periodic stress tests and to maintain both recovery plans and orderly wind-down plans, so that a failing issuer can return reserves without disorder. Consumer safeguards extend to the issuance window itself: firms would have to protect customer money received before the corresponding stablecoins are issued, closing the gap where prepaid funds sit unbacked. Stablecoins that remain outside the dedicated framework would continue to be treated as digital payment tokens under existing PSA rules, meaning no lighter path around the regime. The 2023 framework that these amendments would codify has governed Singapore's approach for three years; codifying it in statute, rather than leaving it as regulatory guidance, changes the enforcement calculus for every issuer marketing stablecoins into Singapore — including products whose tokenomics rely on reserve yield that MAS now proposes to ban in the regulated tier. Public comments are open until Oct. 16. Readers tracking the market in real time can follow live spot and futures prices on Binance.

What the Consultation Paper Actually Binds

Reading the consultation document itself, the key distinction is proposal versus final rule: nothing here binds any issuer yet, and every element — joint issuance recognition, foreign-framework equivalence, the interest ban — can be amended or dropped before legislation reaches Parliament. Once enacted, the obligations would bind PSA-licensed stablecoin issuers, while foreign-issued tokens would gain recognition only through MAS's equivalence assessment. With comments closing Oct. 16, COINOTAG expects cross-border settlement issuers to lobby hardest for the foreign-recognition clause.