Mankiw Research: Why do crypto projects love to "queue up for certification" in Singapore?

In the cryptocurrency field, where global regulation is still not unified, why are crypto projects so eager to obtain a crypto license in Singapore? This article will provide a comprehensive and easy-to-understand analysis of the advantages of a Singapore license, what crypto licenses are available in Singapore, the application requirements, and how companies should apply for a Singapore crypto license.

Authors: Shao Jiadian, Attorney Liu Honglin , Mankiw Blockchain Legal Services

introduction

In 2025, long queues formed at the door of the Monetary Authority of Singapore (MAS). From Asian digital asset exchanges to North American stablecoin issuers, and global asset management and economic services providers, countless crypto projects submitted their applications, all vying for a cryptocurrency license in Singapore. Some even joked, "You can't even call yourself a compliant project without MAS approval."

In the cryptocurrency field, where global regulation is still not unified, why are crypto projects so eager to obtain a crypto license in Singapore? This article will provide a comprehensive and easy-to-understand analysis of the advantages of a Singapore license, what crypto licenses are available in Singapore, the application requirements, and how companies should apply for a Singapore crypto license.

Why are Singapore license plates so popular?

When Singapore is mentioned, everyone knows that its licenses have "high barriers to entry" and "high costs," but the consensus is that "if you really want to grow big, you'll have to get one sooner or later."

This precisely illustrates that a Singapore license is not a "ticket" for everyone, but rather a "special ticket" designed specifically for a particular strategy. Choosing Singapore is not because it is cheap or easy, but because after doing the math, you find that it can precisely exchange for what you ultimately want: a "legal identity" widely recognized in the mainstream global financial circle—helping you buy trust, buy market access, and buy the right to long-term survival.

Specifically, Singapore's value is reflected in four dimensions:

• First, it uses "precise strategic positioning" to match your "investment goals".

If your model serves markets with weak financial infrastructure and extreme price sensitivity, and prioritizes lightness and flexibility, then Singapore's "heavy equipment" approach may not be suitable.

However, if your ambition is to "go mainstream," and your goal is to safely accept funds from global institutions , gain recognition for your issued assets in traditional markets , or establish a compliant headquarters in the high-growth region of Southeast Asia , then the high cost of a Singapore license is no longer an ordinary expense, but a necessary facility on the specific track to the "mainstream financial world."

• Second, it uses a "mature ecosystem" to match your "operating costs" plan.

Singapore's costs are systemic, with high requirements leading to high expenditures: from capital and local compliance teams to the need for legal and auditing opinions from accredited institutions. However, behind this lies a highly efficient ecosystem for "legitimate players": from crypto-savvy law firms and auditing firms to blockchain-savvy banks and tax advisors, the entire industry chain is in place. You pay a premium for a mature solution, eliminating the need to adapt to the market from scratch. More importantly, participants here compete under the same set of established standards, focusing on business acumen and innovation rather than regulatory arbitrage, creating a clearer and fairer environment.

• Third, it addresses your concerns about the "future of policy" by providing "certainty of rules".

In the crypto world, the biggest hidden cost is "uncertainty." Singapore's current regulatory environment coexists clear compliance requirements with long-term openness to innovation opportunities . It employs a "categorized management" approach : businesses involved in payments are clearly governed by the Payment Services Act (PSA); those with securities attributes are clearly subject to the Securities and Futures Act (SFA). Furthermore, Singapore has long operated a regulatory sandbox mechanism , allowing innovative projects to test business models in a controlled environment. This is like going into a game where the field, sidelines, and rules are all clearly defined in black and white. Although the referee (MAS) may be strict, you don't have to worry about the rules suddenly changing or the field shrinking unexpectedly halfway through the game. This certainty enables long-term technological investment and business planning, making it a crucial resource for the future.

• Fourth, it uses a "trust premium" to deliver on your expectations of "compliance benefits".

The Monetary Authority of Singapore (MAS) is renowned for its stringent regulations, which is precisely why its license is a highly valuable "global credit passport." In the eyes of traditional financial institutions and large capital firms, it's equivalent to a "credit endorsement." This means that once you hold the license, when connecting with international banks, mainstream custodians, or seeking partnerships with hedge funds and family offices, their risk control processes will be much easier to conduct. The MAS has already handled the most difficult part of the qualification verification for you. This passport is expensive, but it can open many doors that money alone cannot unlock.

I chose Singapore not because it is the "best," but because the "ticket" it offers happens to align with the future I desire.

What crypto licenses are available in Singapore?

In Singapore, license types are categorized by business area. Those involving cryptocurrency businesses can generally fall into the following categories:

Before applying for the corresponding license, we need to accurately define our own business positioning, know what the company wants to do, what it can do, and what the effect will be, so that we can have a direction for applying for the license.

Specifically, the structure and development of the cryptocurrency industry is not a one-step process, but rather a series of waves. The entire industry can be seen as three stacked "S-shaped curves," corresponding to: creating assets, accumulating assets, and using assets.

• The first curve: From 0 to 1, "creating tools" (asset creation).

This phase began with the advent of Bitcoin in 2009, and its core was the invention of new "tools" from scratch. From the initial monetary assets to later stablecoins, NFTs, memes, and tokenized stocks, the variety of assets has increased dramatically. By 2024-2025, this wave of "tool creation" reached its peak, with the number of listed tokens exploding from tens of thousands to millions.

Now, the most disruptive "from 0 to 1" step is basically complete, like the roof of a house. Of course, there is still a lot of room for refinement, such as turning credit and more real-world assets into on-chain tokens, but these are more like optimizations "from 1 to N".

• The second curve: Accumulating wealth through real money (asset accumulation)

Once the tools are developed, naturally some people will want to own and hoard them. The logic is simple: the more things there are, the more valuable they are, and the more people will want to buy and hold them. This demand for "hoarding" has directly fueled a large number of businesses: wallets and custodians for storing assets, exchanges for buying and selling assets (established players like Coinbase have seen a surge in trading volume, and traditional players like Robinhood have also increased their investment), institutions for ensuring asset security, and crypto funds/asset management, etc.

More importantly, the nature of the group "accumulating wealth" has changed: from early retail investors and tech enthusiasts to asset management companies (putting cryptocurrencies into retirement accounts), listed companies (adding Bitcoin and stablecoins to their balance sheets), and even some sovereign wealth funds. The industry has just embarked on the steepest upward phase of this curve, and the influx of "regular capital" and "large funds" has only just begun.

• The third curve: Learning to make money work for you (asset utilization)

Once you've accumulated assets, the next step is naturally to use them and generate value. Crypto assets, because they are composable and programmable, are excellent "financial Lego." Currently, there are already various ways to use them, such as stablecoin payments, earning interest through lending protocols, earning fees by providing liquidity for transactions, and staking to generate returns.

However, this third growth curve is just beginning, with the vast majority of assets still in a "dormant" state, and the scenarios for their use are too few and too early. Precisely because of this, the areas where these assets can be utilized and explored in innovative ways in the future may be the biggest "blue ocean."

Currently, if we conduct a "financial checkup" on the entire Web3 industry, we'll find a reality: truly profitable sectors and businesses are actually few and far between, roughly falling into these categories: First, Bitcoin mining. Based on current mainstream mining machines and electricity prices, the production cost of each Bitcoin is approximately $60,000. This year, Bitcoin's highest price reached $127,000, and it's currently around $90,000, theoretically making it a profitable business. Second, compliant digital asset trading service providers. They charge a fee for every transaction; the larger the trading volume, the more they earn. Third, compliant fund/asset management. This involves applying traditional fund logic: managing clients' crypto assets and earning money through management fees plus a share of excess returns. Fourth, and this direction, which has both commercial value and industrial upgrading significance, is cryptocurrency payment.

Therefore, our interpretation of Singapore's policies can focus on the regulatory and licensing requirements in three areas: cryptocurrency issuance, digital asset trading services (including fund/asset management businesses), and crypto payments.

How do I apply for these crypto licenses?

(a) Cryptocurrency Issuance

Obtaining a license in Singapore is a complex and technical process. For Web3 projects, the first step isn't rushing to fill out forms, but rather figuring out a fundamental question: What exactly is your token?

MAS focuses on substance, not form. Whether your token is a "securities" (promised returns) or a "payment instrument" (used for exchange) determines which law governs it, and this is the starting point for all compliance.

Singapore broadly categorizes tokens into four types: security tokens (regulated by the Securities and Futures Act, SFA), payment tokens (regulated by the Payment Services Act, PSA), utility tokens, and governance tokens (primarily governed by industry guidelines and self-regulation). Simply put, it keeps "securities separate from payments," allowing other tokens to be explored within a self-regulatory framework. This categorized regulation effectively manages risk without stifling innovation.

(1) Issuance of security tokens

Specifically, when assessing whether a cryptocurrency constitutes a security token, MAS examines the entire project like a detective, including the white paper, promotional materials, and social media statements, focusing primarily on the following core questions:

1. What rights do tokens grant? Does holding tokens grant tangible rights (such as company ownership, profit sharing rights, and voting rights), or is it merely a vague concept of "potential future usefulness"?

2. What is the fundamental purpose of the issuance? Is it to raise funds and promise returns to investors (such as fixed interest or future buybacks), or to provide a specific product or service (such as using it to redeem storage space or game items)?

3. How are the funds managed? Does the project pool participants' funds through a special legal entity (such as an SPV) similar to a traditional fund, with a professional team managing the investments and the returns distributed among the participants in proportion?

4. Where does the return come from? Does the holder's return come from the certain cash flow generated by the project itself (such as interest and dividends), or does it depend entirely on buying low and selling high in the secondary market?

If the answer leans towards investment and returns , then your token is likely to be classified as a security token.

Issuing security tokens in Singapore is essentially a compliance process of "trust building," the core of which is proving your credibility to regulators and the market. Under the Securities and Futures Act (SFA), the entire process must follow a clear compliance path, primarily revolving around the following three key steps:

First, choose the issuance path: different issuance paths determine the basic framework for compliance.

• Public or collective investment scheme (CIS) offerings: These are open to the public and have the most stringent requirements. They require the preparation and registration of a prospectus and are subject to substantive review by the MAS. CIS offerings also need to comply with the Collective Investment Scheme Guidelines and obtain additional MAS authorization.
• Private placement (no more than 50 people), qualified investors (only for institutional/accredited investors), and small offerings (total amount not exceeding S$5 million in December): are usually exempt from registering a prospectus, but the issuer will be subject to resale restrictions.

Second, prepare core documents: Use "transparency" to gain "trust." Regardless of the path chosen, information disclosure must meet the legal requirements of being "truthful, accurate, and complete." The core principle is:

• Clearly explain the business model: Replace vague vision descriptions with concrete profit models and financial forecasts.
• Disclose all risks: All major risks, including those related to technology, regulation, and market liquidity, must be disclosed in detail and must not be concealed or downplayed.
• Disclose key interests: Provide a full explanation of the team background, token distribution plan (especially the team's share and early investors' shares, lock-up and release conditions), and any conflicts of interest.

Third, leverage professional consultants: "navigators" for compliance processes.

Due to the complexity of the process, a licensed corporate financial advisor in Singapore can be hired to ensure the compliance of the issuance structure.

(2) Issuance of payment tokens

In traditional economies, money serves three main functions : unit of account, medium of exchange, and store of value. Currently, there are four types of instruments that can be used for payments:

• Fiat currencies (including digital fiat currencies) , such as the Singapore dollar, are issued by the central bank and have legal solvency.
• Electronic currencies , such as Alipay balance, WeChat Pay balance, and prepaid card balance, are usually pegged 1:1 to legal tender (such as RMB). They are monetary values stored in electronic form, and users have the right to redeem them from the issuer.
• Digital payment tokens (DPTs ) , such as cryptocurrencies like Bitcoin and Ethereum, are highly volatile in price. They are a digital representation of value that can be electronically transferred, stored, or traded, and do not necessarily represent a claim against the issuer.
• Stablecoins , such as USDT and USDC, are cryptocurrencies pegged to real-world assets (such as fiat currency, gold, or a basket of assets). They are designed to maintain relative price stability through specific mechanisms, with the core objective of addressing the high price volatility of traditional cryptocurrencies (such as Bitcoin), serving as a "safe haven" and efficient payment tool in the crypto economy. For example, one stablecoin pegged to the US dollar (such as USDT, USDC, and PYUSD) is typically equal to one US dollar.

We will be discussing only two types of payment cryptocurrencies: stablecoins and DPTs. The criteria for identifying stablecoins primarily focus on whether they have a peg mechanism, while the criteria for identifying DPTs are whether they meet the following characteristics:

1. Not denominated in any legal tender or linked to the issuer.

The fundamental characteristic of DPT is that its value unit is independent of any sovereign currency such as the US dollar or the Singapore dollar. The issuer neither promises nor assumes responsibility for maintaining a fixed exchange rate with any fiat currency. This is the "gold standard" that distinguishes it from stablecoins or electronic currencies.

2. Can be used (or intended to be used) as a medium of exchange for the public.

This asset is designed, or is actually widely used, as a means of payment for purchasing goods and services or settling debts. It needs to be accepted as a "universal currency" within a specific community or more broadly. For example, Bitcoin and Ethereum are categorized as DPTs because they are used as a means of payment and value transfer.

3. Its value is not backed by the issuer's promise, but rather generated through transactions.

The value of DPT is not backed by any promises from the issuer (such as interest, dividends, or redemption guarantees). Its price is determined entirely by supply and demand in the market, reflected in real-time quotes on exchanges. Holders' profits and losses come purely from market buying and selling ("buy low, sell high"), not from the issuer's credit.

In short, a true DPT has independent value, payable functionality, and market-based pricing.

For digital payment tokens (DPTs), the MAS's regulatory focus is on related service activities (such as exchange, custody, transfer, brokerage, etc.), rather than the issuance of the tokens themselves ; therefore, when providing specific functions or products, issuers only need to ensure that the relevant business complies with the regulatory requirements for DPT services under the PSA.

The issuance of stablecoins is primarily regulated by the Payment Services Act (PSA) and the Stablecoin Regulatory Framework. This is because they possess both the stable, fiat-pegged nature of electronic currencies and the free, programmable nature of digital payment tokens (DPTs). This dual identity necessitates a "hybrid approach" to regulation. If issuers wish to enhance the credibility of their stablecoins and attract institutional and high-volume transaction users through stricter regulation, they can voluntarily apply to launch "MAS-regulated stablecoins" (meeting similar requirements for high-quality reserves, independent custody, redemption guarantees, and information disclosure as electronic currencies), obtaining single-currency stablecoin (SCS) certification from the MAS.

(ii) Digital asset service providers (including fund/asset management business)

(1) Service type

Specifically, the types of digital asset services permitted in Singapore are all listed in Schedule 2 of the SFA. To help everyone understand what these "financial services" actually are and how they relate to cryptocurrencies, we can summarize these activities into three main categories:

• Trading and Financing

The core of these activities is buying, selling, issuing, or facilitating transactions of financial products.

• Hosting and Management

The core of this type of activity is to safeguard other people's assets or manage their investments. As long as you control or manage other people's financial assets (whether it is fiat currency, traditional securities or crypto assets) and provide services in this way, it falls into this category.

• Consulting and rating services

The core of this type of activity is to provide professional advice, assessments, or research to influence investment decisions. This category applies if your business doesn't directly trade or manage assets, but rather profits from influencing others' investment behavior through professional opinions, analysis, or assessments.

(2) Licensing System (CMS License)

According to the SFA, the core of Singapore's digital asset services licensing system is "one master license + multiple regulated activities".

The Monetary Authority of Singapore (MAS) issues only one core "master account"—the Capital Markets Services Licence. Any company wishing to conduct capital markets business compliantly here must first register this "master account."

The real key lies in the "skill packs": After obtaining the main account, you can load one or more "regulated activity" licenses according to your business needs. For example, a company can load both "fund management" and "securities trading" skill packs simultaneously. However, you need to clearly specify which skills to load from the beginning, because each skill pack has independent and detailed operating rules and requirements, and they cannot be mixed.

It's worth noting that Singapore's fund/asset management business can be further subdivided into three models based on target clients, business scope, and scale : Retail LMFC, Qualified/Institutional LFMC, and Venture Capital Fund Manager (VCFM). VCFM is a "lightly regulated" system established by MAS to promote early-stage venture capital investment, with clearly defined business scope and restrictions on expanding into other capital market services.

(3) License application conditions

Obtaining a Singapore CMS license is not only about meeting regulatory requirements, but also a comprehensive upgrade of a company's governance, risk control capabilities, and professional standards. The MAS audit mainly assesses companies based on the following four dimensions:

First, the company's main body and basic qualifications.

• Eligible legal entities: Applicants must be compliant entities registered in Singapore, such as companies, sole proprietorships or partnerships (in certain circumstances).
• Substantive operations, eliminating "shell companies": MAS explicitly opposes regulatory arbitrage. Companies must have a real office space in Singapore, a core operating team and decision-making functions, and be able to independently execute the business they apply for.
• Good business track record and reputation: The company and its major shareholders and directors must have good credit, and the core team must have a certain number of years of work experience in the financial field.

Second, key financial threshold requirements: Financial soundness is a key focus of MAS assessment, and the minimum basic capital requirements vary significantly across different business segments.

In general, the level of capital requirements directly reflects the MAS's assessment of the risk level of various business operations. When planning the application, in addition to meeting the capital threshold, it is even more important to pay attention to the unique compliance priorities of each business.

Third, requirements for core personnel and team:

• Local core management: The company is required to appoint at least one executive director who is based in Singapore and is fully responsible for local business and compliance; the CEO is also usually required to be based in Singapore and approved by MAS.
• Key appointees and representatives: Each regulated business must appoint a “key appointee” with the appropriate qualifications and experience, and pass the regulatory examinations and registration required by MAS.
• Overall team competence: MAS will comprehensively assess whether the entire team possesses the integrity and comprehensive professional ability to effectively operate the applied business.

Fourth, internal governance, compliance, and risk control systems:

• Internal governance and monitoring system: Establish a clearly defined organizational structure, ensure the independence of oversight functions such as compliance and auditing, and develop standard operating procedures covering all business processes.
• Risk Management Framework: Develop a systematic process and establish a systematic risk management framework to continuously identify and manage market, credit, operational, liquidity, and legal risks.
• Customer asset protection: Ensure that customer assets are separated from the company's own assets and are securely stored. For businesses involving digital assets, specific security solutions such as cold/hot wallet management, private key storage, and multi-signature must be implemented.
• Anti-money laundering/counter-terrorist financing (AML/CFT) system: A comprehensive AML/CFT system needs to be established, including on-chain transaction analysis tools, customer due diligence (CDD), enhanced due diligence in high-risk areas, continuous transaction monitoring, and suspicious transaction reporting (STR).
• Promotion restrictions: Unlicensed or unexempt entities are strictly prohibited from soliciting or advertising to the Singapore public in any form. Permitted information disclosure channels are limited to their own channels (such as official websites and official apps), and the content must focus on risk warnings and education, objectively explain the products, and must not contain any inducements or statements that stimulate trading impulses.

(4) License application process

Applying for a Singapore Capital Markets Services (CMS) Licence is a rigorous and highly interactive process that typically takes 4 to 12 months. The entire process involves not only a review of the company's qualifications but also a comprehensive assessment of its operational compliance.

1. Preliminary Preparation and Planning: Define the business scope, design a compliance structure, assemble a qualified team, and prepare financial resources. Depending on the company's target business type, the company needs to ensure that its paid-in capital and working capital meet the minimum requirements and prepare detailed financial budgets for the coming months to demonstrate the company's ability to continue operating.

2. Document Preparation: With the assistance of professional consultants, prepare a complete set of application documents, including but not limited to a business plan, financial forecasts, internal policy manual, personnel resumes and qualification certificates, etc. Among them, the internal policy manual is the core document of the compliance system , and it is necessary to independently draft anti-money laundering/counter-terrorist financing (AML/CFT) policies, risk management frameworks, compliance manuals, information security policies, and client asset protection rules.

3. Formal Submission: Submit your application and pay the fees through MAS's online application portal (MASNET).

4. MAS Review and Interaction: This is usually divided into a completeness check (initial review) and a substantive assessment (detailed review). Several rounds of inquiries (RFIs) during this period are common. Depending on the project, the review generally takes 4 to 9 months. During this period, additional materials or clarifications may be requested multiple times. Complex or novel business models (such as those involving crypto assets) may take even longer.

5. Final Approval: After the review is passed, MAS may issue an approval in principle (IPA), which is not a formal license but a conditional pre-approval. After all the additional conditions are met, MAS will issue a formal CMS license, and the company can then begin operating regulated activities.

(iii) Encrypted payments

(1) Service type

The PSA lists a " Payment Services List" in Schedule 1. If your business in Singapore falls under any of the items on this list, you will need to apply for the corresponding payment institution license, depending on the size and type of your business. Cryptocurrency payment-related services can be categorized as follows:

• Account and Value Transfer Services

The core of these services is opening and managing payment accounts or facilitating the flow and exchange of value. Whether it's traditional currency exchange or the buying and selling of digital assets, anything involving providing a channel for the transfer of value falls into this category.

• Merchant and Business Payment Services

The core of these services is processing commercial transactions or issuing specific digital value , primarily targeting merchants and business scenarios.

• Digital Payment Token (DPT) related services

This is a regulatory category specifically for digital payment tokens (such as cryptocurrencies like Bitcoin and Ethereum), and it's the part most relevant to Web3 projects. Its core function is to directly engage in the buying, selling, exchanging, or facilitating related transactions of digital payment tokens.

• Stablecoin payments

Regarding stablecoin trading, transfer, acquiring, and custody services, since no specific regulations for stablecoins have been issued, they are still considered a special type of digital payment currency under the Stablecoin Regulatory Framework issued by Singapore in 2023, and are currently subject to the relevant regulations on DPTs under the PSA.

(2) Licensing system

For companies engaged in digital payment token services, Singapore's Payment Services Act (PSA) has established a regulatory framework of "one main license and multiple business modules" .

In simple terms, the MAS issues "payment institution licenses." Companies apply for the corresponding level of license based on their business scale and type, and obtain permission to engage in one or more "regulated payment services" under that license. Similar to the SFA framework, you can combine multiple business modules under one payment institution license, such as "digital payment token services" + "cross-border remittance services." The key is that you need to establish corresponding compliance capabilities for each "business module."

Specifically, the PSA has established a three-tiered licensing system, forming a clear pyramid structure, with higher tiers having stricter regulatory requirements.

1. Currency exchange license: This is the most basic and narrowest type of license.

• Core business: Only engaged in the exchange of different fiat currencies (such as Singapore dollar to US dollar), and not involved in any form of digital payment tokens or electronic money.
• Regulatory requirements: The requirements are relatively low, mainly focusing on anti-money laundering and operational compliance.

2. Standard Payment Institution License ( SPI ) : This is a common starting point for small and medium-sized or startup crypto service providers.

• Eligibility requirements: Engage in one or more of the following businesses, but the total monthly transaction amount does not exceed the statutory threshold. If the business involves DPT, the monthly transaction amount must be less than S$3 million.
• Core businesses: Account issuance, domestic/cross-border remittances, merchant acquiring, digital payment token services, and electronic money issuance.
• Regulatory requirements: Must meet core compliance requirements such as anti-money laundering, cybersecurity, customer information disclosure, and basic capital requirements.

Major Payment Institution License (MPI): This is a license that most mainstream cryptocurrency exchanges and large payment platforms need to hold.

• Eligibility criteria: Engaging in the aforementioned business, with the monthly transaction volume of any business module exceeding the statutory threshold. Once triggered, an upgrade to MPI is required.
• Regulatory requirements: The most stringent, in addition to all the requirements of SPI, it also requires higher paid-up capital requirements (usually starting from S$250,000), stricter segregation of client funds (such as through a statutory trust account), a more comprehensive risk management framework, and regular independent audit obligations.

In Singapore, companies engaged in cryptocurrency-related services (i.e., "digital payment token services") primarily involve the latter two types of licenses, and their common service scenarios are as follows:

License application requirements

MAS's licensing eligibility review typically revolves around the following four dimensions.

First, the company entity and basic qualifications: The applicant must be a legal entity rooted in Singapore and with substantial operations.

• Eligible legal entities: Applicants must be compliant entities registered in Singapore, such as companies, sole proprietorships or partnerships (in certain circumstances).
• Substantive operations, eliminating "shell companies": MAS explicitly opposes regulatory arbitrage. Companies must have a real office space in Singapore, a core operating team and decision-making functions, and be able to independently execute the business they apply for.
• Good business record and reputation: The company and its ultimate beneficiaries, directors and key management personnel must have a good reputation and no record of bankruptcy, crime or serious violations.

Second, key financial threshold requirements: Simply put, business size (measured by monthly transaction volume) determines the application category: Standard Payment Institution (SPI) or Large Payment Institution (MPI). Due to their larger scale and higher risk, MPIs must meet stricter capital and liquidity requirements. Companies need to monitor their transaction volume themselves, and if they exceed the requirements, they must upgrade to MPIs.

Third, requirements for core personnel and team:

• Local core management: The company is required to appoint at least one executive director who is based in Singapore and is fully responsible for local business and compliance; the CEO is also usually required to be based in Singapore and approved by MAS.
• Key Appointees and Representatives: Each regulated activity (such as digital payment token services) must have a “key appointee” (such as a compliance officer or anti-money laundering officer) who has passed an MAS-accredited exam and undergone a background check;
• Overall team competence: The team as a whole should possess integrity and comprehensive business capabilities. Teams with both blockchain technology and financial compliance experience are more highly regarded.

Fourth, internal governance, compliance, and risk control systems:

• Internal governance and monitoring system: Establish a clearly defined organizational structure, ensure the independence of oversight functions such as compliance and auditing, and develop standard operating procedures covering all business processes.
• Risk Management Framework: A risk management system for payments (especially cryptocurrencies) needs to be established, covering operational (such as technical failures and cyberattacks), liquidity, credit and legal risks, and properly managing unique risks such as price volatility, wallet security and private key custody.
• Customer asset protection: Ensure that customer assets are separated from the company's own assets and are securely stored. Legally mandated funds must be deposited in a designated bank trust account. For businesses involving digital assets, specific security measures such as cold/hot wallet management, private key custody, and multi-signature must be implemented.
• Anti-money laundering/counter-terrorist financing (AML/CFT) system: A comprehensive AML/CFT system needs to be established, including on-chain transaction analysis tools, customer due diligence (CDD), enhanced due diligence in high-risk areas, continuous transaction monitoring, and suspicious transaction reporting (STR).
• Technical security and business continuity: A reliable technical security and business continuity plan is required, including system architecture, network security protocols, data encryption and disaster recovery solutions, to ensure that attacks can be resisted and services can be restored quickly.

(4) License application process

Applying for a Singapore Digital Payment Token Service (DPT) Licence is a rigorous and highly interactive process that typically takes six months or longer.

1. Preliminary Preparation and Planning: Define the service type (e.g., DPT transactions, currency exchange + cross-border remittance services), and accordingly determine whether to apply for a Major Payment Institution (MPI) or Standard Payment Institution (SPI) license. Establish a compliance framework, assemble a management team with industry experience (at least one Singapore resident as executive director), and ensure that paid-up capital and continuing operating funds are in place.

2. Document and Statutory Assessment Preparation: With the assistance of professional advisors, prepare a complete set of application documents, including a business plan, organizational structure, internal policies, and key personnel qualifications. Starting in August 2024, two new statutory assessments have been added to the core process : a legal opinion from a law firm stating that the business is regulated under the Payment Services Act , and an independent assessment report from an independent auditor on AML/CFT and consumer protection measures .

3. Formal Submission: Submit the complete application form and all required documents through the online portal designated by MAS.

4. MAS Review and Interaction: MAS will conduct a rigorous review, with multiple rounds of inquiries (RFIs) and requests for supplementary materials being common. The review period varies depending on the complexity of the business and typically lasts several months. If the company undergoes significant changes during the application process, the process may be suspended.

5. Final Approval: After the review is approved, MAS may issue an approval in principle (IPA) with conditions for performance. Once the company meets all the conditions (such as completing a system audit) within the specified time, it can obtain a formal payment license and begin operations.

Conclusion

When we look back at the long queue outside the Monetary Authority of Singapore (MAS), it symbolizes far more than just companies vying for a paper license. Behind it lies a profound shift in understanding: industry participants are beginning to realize that in the process of seeking legal identity and mainstream recognition in the crypto world, strict and clear regulation is an indispensable and high-value "public good."

The significance of cryptocurrency licenses has long surpassed the basic requirement of "compliant survival." It is a "standardized trust certificate" issued to the market by regulatory agencies, backed by their credibility. It paves the way for businesses to connect with traditional finance, provides institutional funds with an assessable benchmark for entry, and ultimately lays the most scarce foundation for the long-term prosperity of the entire ecosystem— systemic trust.

Singapore's experience clearly illustrates that the core function of modern financial regulation is not simply restriction and constraint, but rather to reduce friction and trust costs across the market by providing key public services such as certainty of rules, transparency of procedures, and legitimacy of identities . Choosing Singapore is essentially a proactive choice for companies to access this efficient and stable "trust infrastructure," exchanging their current compliance investments for long-term access to the global mainstream financial stage.

Ultimately, this "compliance journey" to Singapore for global project teams revealed a fundamental trend: the future of the crypto economy will no longer be defined by "deregulation," but rather will emerge from the creatively defined intersection between innovative vitality and financial responsibility, technological freedom and institutional safeguards . Here, clear regulation and cutting-edge innovation are not adversaries, but collaborators shaping the next era of digital finance.

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