Singapore Proposes Stablecoin Issuance License With 100% Reserves
The Monetary Authority of Singapore (MAS) has proposed amendments to the Payment Services Act 2019, which would create a dedicated stablecoin issuance license. This license would require issuers to hold reserve assets at least equal to the par value of every token in circulation.
The proposal also introduces a new framework for designating systemically important stablecoins, allowing MAS to restrict or suspend their circulation if they pose systemic risks. The regulator aims to authorize only a limited number of issuers, assessing applications based on financial soundness, business viability, and operational track record.
Under the draft rules, licensed stablecoin issuers would be prohibited from paying interest or other benefits linked to holding the tokens, in order to keep stablecoins as payment instruments rather than investments. The MAS is also seeking views on requiring a minimum share of reserves to be held in cash or bank deposits.