The Monetary Authority of Singapore (MAS) has today (15th August) finalized its framework for stablecoin regulations, particularly for stablecoin issuers that wish to be recognized and labelled officially as “MAS-regulated stablecoins”.
These new regulations will apply to any single-currency stablecoins pegged to the Singapore Dollar or other G10 currencies that are issued in Singapore.
Under the framework, issuers will have to fulfill major requirements relating to:
- Value stability: SCS reserve assets will be subject to requirements relating to their composition, valuation, custody and audit, to give a high degree of assurance of value stability.
- Capital: Issuers must maintain minimum base capital and liquid assets to reduce the risk of insolvency and enable an orderly wind-down of business if necessary.
- Redemption at Par: Issuers must return the par value of SCS to holders within five business days from a redemption request.
- Disclosure: Issuers must provide appropriate disclosures to users, including information on the SCS’ value stabilising mechanism, rights of SCS holders, as well as the audit results of reserve assets.
With proper adherence to these pre requisites, a Singapore-based stablecoin issuer can apply to MAS in order to have their product be properly recognized as an “MAS-regulated stablecoin”.
[Editor’s Note: This article does not represent financial advice. Please do your own research before investing.]
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