MAS to introduce new stablecoin rules: covering cross-border recognition, interest ban

PANews reported on September 1, according to the Singapore Business Review, that the Monetary Authority of Singapore (MAS) plans to amend the Payment Services Act 2019 to introduce a stablecoin regulatory framework covering cross-border recognition, interest restrictions, and financial stability safeguards. The framework will cover locally issued single-currency stablecoins pegged to the Singapore dollar or G10 currencies, and only licensed issuers may promote their tokens as MAS-regulated stablecoins. MAS proposes allowing jointly issued stablecoins registered in Singapore to be included in the framework if risks are sufficiently mitigated, and it will consider recognizing a limited number of foreign-issued stablecoins subject to comparable overseas regulatory frameworks, especially for cross-border wholesale use cases. In addition, MAS plans to prohibit the payment of interest on MAS-regulated stablecoins and impose additional requirements on issuers, including stress testing, recovery, and orderly wind-down plans. The consultation period runs until October 16.