On May 30, 2024, the Monetary Authority of Singapore (MAS) released the final regulatory policy for 'Digital Token Service Providers (DTSP)', clearly stating that all crypto service providers registered or operating in Singapore must stop providing services to overseas users by June 30, 2025, if they do not obtain a DTSP license, with no transition period. Violators face fines of up to SGD 250,000 and a maximum of 3 years in prison. The policy's definition of 'employees' is vague, and whether project founders and shareholders are subject to regulation will be at MAS's discretion; licensed or exempt companies are not affected.
Singapore was once the Web3 center of Asia, attracting a large number of crypto exchanges, funds, and project parties with its regulatory strategy of 'differentiation' (allowing companies to freely serve overseas markets while strictly regulating local businesses). Temasek even invested in companies like FTX to solidify its status as a 'crypto paradise'. However, the collapse of FTX, which Temasek invested in, and the bankruptcy of local Three Arrows Capital in 2022 severely damaged Singapore's financial reputation. MAS believes that some crypto companies can easily be used for money laundering, terrorist financing, and other illegal activities, harming the country's image. The core of this policy is to prevent such 'reputational risks'.
After the policy was released, the industry's reaction was strong. Unlicensed companies fell into confusion and panic, with some planning to relocate to Hong Kong, Dubai, Malaysia, and other places; practitioners are accelerating their 'foot voting' due to high living costs in Singapore and reduced earning opportunities. Licensed companies or those on the exemption list (such as Cobo, OKX SG, etc.) are less affected, and even gain a competitive advantage due to clear regulations.
This event marks Singapore's farewell to the era of 'regulatory arbitrage', as the crypto industry shifts from 'wild growth' to a new phase of 'licensed compliance', and global companies may enter a new cycle of regionalization and diversification.
