Singapore Tightens New Stablecoin Rules: 100% Backing, Ban on Interest

Monetary Authority of Singapore (MAS) has today proposed a new licensing framework focused on stablecoin reserves, redemption, and user protection. The plan could give compliant stablecoins a clearer role in digital finance, while issuers that fail to meet the rules would remain under the Digital Payment Token framework.

MAS Sets New Rules for Regulated Stablecoins

On September 1, 2026, MAS published a consultation paper proposing changes to the Payment Services Act 2019 to formally implement its Single-Currency Stablecoin (MAS-SCS) framework.

Under the proposal, Singapore’s MAS will only licensed issuers could call their tokens “MAS-regulated stablecoins. The token must be tied to the Singapore dollar or a G10 currency, such as the U.S. dollar or euro.

Issuers must also hold reserves equal to 100% of the stablecoins in circulation, using safe and liquid assets. Users must also be able to redeem their tokens for the same amount of fiat currency within five business days.

However, Stablecoins that do not meet these rules will not receive the MAS-regulated label. Instead, they will be treated as Digital Payment Tokens (DPTs), like other cryptocurrencies.

The Strict Ban on Stablecoin Interest

One major restriction is that issuers would not be allowed to pay interest or other yield like benefits to holders of MAS-regulated stablecoins.

The aim is to keep stablecoins focused on payments and transactions, instead of letting them work like savings or investment products.

This would keep stablecoins separate from traditional banking products and reduce the risk of users treating them mainly as a way to earn returns.

MAS Deputy Managing Director Ho Hern Shin said the framework would provide “clear regulatory guardrails for stablecoins that meet high standards of value stability and governance.”

Singapore Opens Door to Foreign Stablecoins

The proposal also covers international use. MAS wants to allow stablecoins jointly issued by Singapore and foreign companies to qualify under its framework if the related risks are properly managed.

For wholesale cross-border use, MAS also plans to recognize a limited number of foreign-issued stablecoins regulated under comparable overseas rules.

This could give regulated stablecoins a wider role in cross-border transactions and tokenized financial markets.

What Next in Regulatory Steps?

The next key date is October 16, 2026, when MAS will close its public consultation. Crypto firms, exchanges and other market participants can submit their views on the proposed stablecoin rules until then.

After the feedback period ends, MAS will review the responses before moving ahead with the proposed legislative changes to the Payment Services Act. 

The changes would then need to go through Singapore’s legislative process before becoming law.