On-shore VASP in Singapore

MAS — All DPT service regulation, PSA licensing, AML/CFT, stablecoin framework, TRM guidelines

Payment Services Act 2019 (2019) — DPT service licensing — MPI/SPI licenses

Securities and Futures Act (2001) — Security tokens, CMS licensing

MAS AML/CFT Notices (PSN01, PSN02) — AML/CFT requirements for DPT service providers; amendments effective July 2025

MAS Technology Risk Management Guidelines (2021) — Cybersecurity, data protection, operational resilience

VASP: Major Payment Institution (MPI) license for DPT services. SGD 250,000 base capital (~$185K USD). 170+ applications received, only ~20-30 full MPI licenses granted. SPI option: SGD 100,000 base capital with transaction limits (SGD 3M single/SGD 6M aggregate). Must have Singapore entity, resident director, local compliance officer, physical office.

CUSTODY: Included under DPT MPI license. Customer asset segregation mandatory (statutory trust since 2024). Security deposits (SGD 100K-200K) required.

EXCHANGE: MPI license. MAS explicitly discourages retail crypto speculation — marketing to general public prohibited (Jan 2022), no incentive programs, no ATMs in public areas. Stablecoin issuers must maintain 100%+ reserves in cash/equivalents at SG-licensed institutions.

Monetary Authority of Singapore (MAS): This is the central bank and integrated financial regulator of Singapore. MAS is the primary body responsible for regulating all digital asset and crypto-related activities, issuing licenses, and enforcing compliance with financial regulations.

This is the cornerstone legislation for cryptocurrency regulation in Singapore. It regulates entities that provide services related to "Digital Payment Tokens" (DPTs), which is MAS's term for cryptocurrencies like Bitcoin and Ethereum.

Dealing in DPTs (e.g., buying and selling on behalf of customers).

Facilitating the exchange of DPTs (e.g., operating a DPT exchange).

Receiving or sending DPTs (e.g., cross-border DPT transfers).

DPT issuance (e.g., initial coin offerings where the token functions as a payment token).

MAS AML/CFT Notices (e.g., PSN01, PSN02 for Payment Services):

These notices lay out the specific Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT) requirements for financial institutions, including DPT service providers.

Travel Rule adopted — threshold: SGD 1,500

Requirements: DPT service providers are required to obtain and transmit certain originator and beneficiary information for DPT transfers.

Thresholds: This applies to DPT transfers involving a value of S$1,500 or more (or its equivalent in other currencies/DPTs).

Information to be Transmitted:

Originator Information: Name, account number used for the transaction, physical address, national identity number (or customer identification number if national ID is unavailable), and date and place of birth (if available).

Beneficiary Information: Name and account number used for the transaction.

Timing: This information must be obtained and transmitted immediately and securely with the DPT transfer itself. Where this is not technically feasible, the information must be sent by other means within a reasonable time.

MAS Notice PSN02 on Prevention of Money Laundering and Countering the Financing of Terrorism – DPT Service Providers (Paragraphs 6.4, 6.5, 6.6)

Adopted and Enforcement Status: The rule is mandatory for all regulated payment service providers, including VASPs offering digital payment token (DPT) services under the Payment Services Act (PSA) 2019. Compliance became a legal requirement on January 28, 2020.

Effective Date: January 28, 2020.

Threshold Amounts: Applies to virtual asset transfers ≥ S$1,500 (approximately US$1,000 equivalent), requiring VASPs to collect and share sender/recipient personally identifiable information (PII).

Covered VASPs: All licensed DPT service providers under the PSA, such as centralized crypto exchanges like Crypto.com and Gemini, which must handle incoming/outgoing transfers compliantly. Non-custodial wallets may require verification (e.g., Satoshi Test) for withdrawals exceeding S$20,000 monthly from custodied wallets.

Evidence fact sg.tax not found (may have been renamed).

For Businesses (Companies and Sole Proprietors):

Trading of Digital Tokens: Profits derived from the trading of digital tokens (e.g., crypto exchanges, mining operations, professional traders) are treated as taxable income under the Income Tax Act.

No capital gains tax applies to gains from selling or disposing of crypto held as a capital asset (e.g., long-term investments by individuals).

Digital Payment Tokens (DPTs):

As of 1 January 2020, DPTs that meet specific criteria (e.g., fungible, interchangeable, not pegged to any fiat currency, medium of exchange) are exempt from GST when used as a medium of exchange.