The Payment Services Act (PS Act) in Singapore is set to undergo amendments, as announced by the Monetary Authority of Singapore (MAS). The changes will expand the regulatory framework for digital payment token (DPT) service providers. This move by Singapore’s central bank will bring various activities within the scope of the PS Act, including custodial services for DPTs, token transfers and exchange, and cross-border money transfers.
MAS clarified that the law will apply even in cases where the service provider does not physically possess the funds or where the money is not accepted or received in Singapore. The regulator also stated that the amendments will allow for additional requirements to be imposed on DPT service providers.
The implementation of the amendments will occur in stages, commencing on April 4. MAS has assured entities affected by the expanded scope that transitional arrangements will be provided. These entities are urged to notify the central bank within 30 days and apply for a license within six months if they wish to continue their operations while under review.
MAS has also emphasized that noncompliant companies will be forced to cease their activities. Entities that fail to meet the requirements outlined in the amendments will be shut down once the changes come into effect.
In addition to the expanded scope, MAS will introduce amendments aimed at safeguarding customer assets of payment token service providers. These amendments will cover the segregation of customer assets, placement in a trust account, maintenance of books and records, and ensuring security protections for customer assets. The implementation of these asset protection measures will occur six months after April 4.
In recent times, several crypto companies have acquired licenses to offer their services in the Singaporean market. Notable organizations such as Crypto.com, Coinbase, and Ripple have obtained complete payment institution licenses in the country. Crypto.com obtained its Major Payment Institution (MPI) license in June 2023 after fulfilling the necessary requirements. Ripple received formal approval on October 4, while Coinbase acquired the full MPI license on October 2, 2023.
In related news, Singaporean police have recommended the use of hardware wallets to protect against crypto theft. The market in Singapore continues to attract attention and investment, with significant developments and growth in the crypto industry.