Quick Answer
Yes, cryptocurrency is legal in Singapore but tightly regulated.
- The Monetary Authority of Singapore (MAS) regulates crypto under the Payment Services Act.
- Crypto businesses must be licensed by the MAS to operate legally.
Legal Status of Crypto in Singapore
Cryptocurrency is legal in Singapore, where it operates within a well-defined and stringent regulatory environment rather than a legal gray area. This status is shaped by the country's goal to foster innovation while ensuring financial integrity, leading to a framework that permits crypto activities under strict oversight. The Monetary Authority of Singapore (MAS) acts as the primary regulator, enforcing compliance requirements and licensing for crypto service providers under laws like the Payment Services Act.
Current Regulations
Singapore's crypto landscape is governed by the Monetary Authority of Singapore (MAS) primarily through the Payment Services Act, which mandates that all digital token service providers must be licensed to operate. As of June 2025, these tightened crypto licensing rules now cover firms serving only overseas customers, a move designed to close regulatory gaps and align with global anti-money laundering standards. Key compliance requirements also include the enforcement of the FATF "Travel Rule" for transactions over SGD 1,500, the segregation of customer assets, and a ban on credit card purchases for retail investors, all part of Singapore’s 2025 regulations.
Regulatory Authorities
Several key regulatory bodies in Singapore are responsible for overseeing the country's crypto landscape.
- Monetary Authority of Singapore (MAS): As the central bank and primary financial regulator, MAS is responsible for licensing all crypto service providers under frameworks like the Payment Services Act. It enforces stringent anti-money laundering rules, sets consumer protection standards, and ensures the overall stability and integrity of the digital asset market.
- Inland Revenue Authority of Singapore (IRAS): The IRAS is the main authority responsible for all tax-related matters concerning cryptocurrency in Singapore. It provides guidance on how crypto transactions are taxed and oversees the reporting of crypto-related earnings on tax returns.
Historical Context
Singapore's crypto regulation has evolved from a relatively open stance to a more stringent framework. The journey began with the Financial Services and Markets Act in April 2022, which laid the groundwork for tighter oversight. A major policy shift occurred following the high-profile collapse of Singapore-based firms in 2022. In response, the MAS mandated that by June 30, 2025, all crypto service providers, including those serving only overseas clients, must be licensed. This move, aimed at curbing money laundering risks and aligning with FATF requirements, increased compliance burdens and prompted some unlicensed exchanges to relocate, ultimately raising the bar for the industry.
Compliance Requirements for Businesses in Singapore
Crypto businesses in Singapore must navigate a stringent set of compliance requirements established by the Monetary Authority of Singapore (MAS) to operate legally. Key obligations are outlined in government guidance and legislation like the Payment Services Act.
- Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) Checks: Businesses must implement robust AML/CFT frameworks. This includes conducting customer due diligence, monitoring transactions, and reporting suspicious activities as detailed in various MAS notices. The regulator has set a particularly high bar for licensing Digital Token Service Providers (DTSPs) due to heightened money laundering risks, and licensed exchanges are expected to report illegal activities to authorities.
- Know Your Customer (KYC) Requirements: As a core component of AML obligations, firms must perform thorough Customer Due Diligence (CDD). This involves verifying a customer's identity, understanding the purpose of the business relationship, and conducting ongoing monitoring. These KYC procedures are mandatory for all licensed exchanges operating in the country.
- Other Mandatory Procedures: Beyond AML/KYC, businesses must adhere to several other rules. These include reporting suspicious activities and fraud incidents to MAS, implementing specific anti-scam measures for e-wallets, and complying with transitional provisions under recent amendments to the Payment Services Act.
Why this matters for Cross-Border Payments
For businesses facilitating cross-border payments between Singapore and India, these stringent regulations introduce a double-edged sword. While the enhanced oversight provides a layer of security and legitimacy, it also creates significant operational hurdles for transactions flowing into and out of the Indian market. Companies may face increased compliance costs, slower transaction processing times due to rigorous KYC and AML checks, and greater friction when moving funds. These pain points can diminish the efficiency advantages often associated with using cryptocurrency for international remittances and trade between the two nations.
How Lightspark Enables Compliant Crypto-Native Payments
Lightspark provides infrastructure for the 'Money Grid,' a global payment network built on Bitcoin and the Lightning Network. Its core products, Lightspark Connect and Grid Switch, enable instant, low-cost cross-border payments. Lightspark Connect offers native access to the network for Bitcoin transactions, while Grid Switch bridges traditional finance with crypto by connecting domestic real-time payment systems. This combination allows money to move like information on the internet—instantly and at a fraction of the cost, directly addressing the friction and delays common in traditional cross-border transactions.
To help businesses navigate Singapore's strict regulatory environment, Lightspark offers tools designed to facilitate compliance. The platform provides features like audit-ready reporting, flexible custody options, and integrations that support requirements such as the Travel Rule and OFAC screening. These capabilities allow regulated institutions like digital banks and exchanges to leverage Lightspark's network while managing their own compliance obligations, turning a complex regulatory landscape into a manageable part of their operations.
To learn more about how Lightspark is building the future of open, instant financial infrastructure, visit their website or connect with their sales team to unblock your next market.
Notice: This article is provided for informational purposes only and does not constitute legal advice.
Sources
- Liam, Erin. "CNA Explains: Singapore's Tightened Crypto Licensing Rules – 'Closing the Door' or 'Raising the Bar'?" CNA, Mediacorp Pte Ltd, 20 June 2025, www.channelnewsasia.com/singapore/crypto-licensing-mas-cna-explains-5186446.
- Monetary Authority of Singapore. "MAS Clarifies Regulatory Regime for Digital Token Service Providers." Monetary Authority of Singapore, 6 June 2025, www.mas.gov.sg/news/media-releases/2025/mas-clarifies-regulatory-regime-for-digital-token-service-providers.
- Monetary Authority of Singapore. Payment Services Act 2019. Monetary Authority of Singapore, 15 Apr. 2019, www.mas.gov.sg/regulation/acts/payment-services-act.
- Nallapaneni, Dhiraj. "Singapore Crypto Tax: A Comprehensive Guide (2025)." CoinLedger, Coin Ledger, Inc., 2025, coinledger.io/blog/singapore-crypto-tax.
- Singh, Onkar. "Is Your Crypto Wallet or Exchange Still Compliant? Singapore’s 2025 Regulations Explained." CCN.com, 6 June 2025, www.ccn.com/education/crypto/singapore-crypto-rules-wallet-exchange-compliance-explained/.
- "Tougher Singapore Crypto Regulations Kick In." France 24, 30 June 2025, www.france24.com/en/live-news/20250630-tougher-singapore-crypto-regulations-kick-in.
