Singapore has implemented strict regulations for cryptocurrency firms, mandating that all companies based in the country must cease providing digital token services to clients outside Singapore by June 30, 2025, unless they acquire the necessary licensing. These rules are part of the Financial Services and Markets Act (FSM Act) established in 2022 by the Monetary Authority of Singapore (MAS). Following an industry review, MAS confirmed that there will be no grace period for compliance. Every firm, whether a company, partnership, or individual, must either obtain a license to continue international operations or shut down that segment of their business by the specified deadline.
Non-compliance could lead to penalties, including fines up to S$250,000 (approximately US$185,000) and potentially three years of imprisonment. The regulations apply broadly, even affecting firms whose international crypto operations are not their primary focus. Under the FSM Act, any digital token services conducted by Singapore-based entities are considered as operating within the country’s jurisdiction and must adhere to local regulations. Only firms that are already licensed or exempt under other existing financial laws, such as the Securities and Futures Act, can continue operations without infringing on these new regulations.
Experts have raised concerns regarding the rigorous licensing process, predicting that the MAS may issue licenses in very limited circumstances due to worries about money laundering and terrorism financing. Legal professional Hagen Rooke emphasized the urgency for companies to explore structural changes to mitigate compliance risks, including removing their ties to Singapore. This regulatory change marks a significant shift in Singapore’s approach to cryptocurrency oversight, as the country aims to tighten its control over cross-border crypto activities and enhance anti-money laundering and counter-terrorism financing measures within its jurisdiction.