Once upon a time, Singapore was praised by global Web3 entrepreneurs as the 'crypto safe haven' of Asia and even the world, thanks to its coexistence of openness and prudence in financial policy. However, a sudden regulatory storm is completely rewriting this situation. On May 30, 2025, the Monetary Authority of Singapore (MAS) officially released new regulatory rules for digital token service providers (DTSP), adopting a 'zero tolerance' stance, requiring all cryptocurrency companies operating in Singapore without compliance licenses to fully cease operations or withdraw by June 30, or face criminal penalties.
This hardline measure, which almost leaves no transition period, is viewed by the industry as a comprehensive expulsion of potential 'scammers' (referring to projects that exploit regulatory grey areas for fraud or speculation). When Singapore decisively shuts its doors, a question arises: where will the 'expelled' crypto capital and talent flow? The answer seems to clearly point to the shining pearl of the Middle East—Dubai. Will this desert city, which is opening its arms to embrace Web3, become the 'buyer' in this regulatory migration?
The core of Singapore's regulatory shift is to impose licensing obligations on all individuals or institutions providing digital token services that have a place of business in Singapore, as mandated by Section 137 of the FSM Act. The core points of the new regulations can be described as 'fast, fierce, and precise':
An unyielding deadline: The MAS clearly states that all affected parties must either obtain a DTSP license or completely cease all related business by June 30, 2025. The MAS has refused to establish any transition period, which means that the reaction time available to businesses is extremely limited.
Extremely difficult to obtain licenses: Want to stay? First, get a license. But the MAS bluntly states that the DTSP license 'will only be granted under extremely limited circumstances'. This almost completely blocks the path for most unlicensed companies to remain compliant, and its implication is nothing short of a 'discouragement'.
Wide scope of enforcement: The targets of the new regulations are not only international exchanges headquartered in Singapore but also a large number of Web3 companies that are legally registered in Singapore but operate globally, such as certain DeFi protocols, NFT platforms, game development teams, and even remote developers working from home. The MAS has a very broad definition of 'place of business', which may include not only formal offices but also shared workspaces and home offices.
Deterrence of criminal liability: Continuing to operate in violation after the 'deadline' will constitute a criminal offense, subject to severe penalties as stipulated by the FSM Act.
So, why is Singapore so resolutely wielding the regulatory 'big knife'? The core of the answer lies in the ultimate defense of the country's 'financial reputation'. The MAS repeatedly emphasizes in its documents that digital token services have strong cross-border anonymity attributes, making them easily used for illegal activities such as money laundering and terrorist financing. Although many companies do not serve clients in Singapore, once these Singapore-based companies 'get into trouble', Singapore will inevitably bear the global reputation and regulatory spillover effects. Therefore, the regulatory goal of the MAS is to filter out high-risk entities at the source, preferring to give up some innovation inclusivity rather than sacrificing the reputation of the national financial center. This is a strategic, preventive defense of the 'regulatory reputation red line'.
Notably, in stark contrast to Singapore's harshness and expulsion is Dubai's enthusiastic call. When cryptocurrency companies feel the chill in Singapore, this hot land in the Middle East is attracting global attention in an unprecedented manner. As popularized at the TOKEN2049 conference, the saying 'Habibi, Come to Dubai' encapsulates how Dubai is becoming the de facto 'promised land' for the crypto industry. Its appeal mainly comes from the following aspects:
Attractive tax policies: Dubai offers a highly competitive tax environment for businesses. Many companies can enjoy exemptions from corporate income tax, such as businesses with annual revenues below 3 million UAE Dirhams (approximately $815,000) or those registered in specific free zones (such as the Dubai International Financial Centre DIFC or the Dubai Multi Commodities Centre DMCC). Even if taxes are required, the rate is only 9%, far lower than major economies like Europe and the U.S.
Clear and proactive regulatory framework: Unlike the unclear regulatory situations in many regions around the world, Dubai has established the world's first independent digital asset regulatory body—the Virtual Assets Regulatory Authority (VARA). VARA is committed to creating a coherent and progressive regulatory environment that encourages innovation while providing clear legal guidance. This provides valuable certainty for cryptocurrency companies, as Middle Eastern regulators eliminate fraudulent companies through strict due diligence, leaving behind quality enterprises.
Strategic geographical location and talent pool: Dubai is located at the crossroads of Europe, Asia, and Africa, making it a natural global trade and tourism gateway. Its modern infrastructure, safe living environment, and high quality of life attract top talent and founders from around the world to settle here. Dubai's strong international connectivity, deep talent pool in technology, and secure environment are making it a vibrant center for blockchain innovation.
A 'knowledgeable' government and an active ecosystem: Many royal family members and the entire government system in the region have engaged in the crypto field. They are knowledgeable, and you don't need to explain basic concepts to them, making communication much easier. The Dubai government is not only actively promoting the 'blockchain strategy', aiming to be the world's first government driven by blockchain, but also accepts some cryptocurrency payments and strongly supports various large industry conferences, creating an extremely active ecosystem.
The tightening of regulations in Singapore has objectively created a huge opportunity window for Dubai. High-quality Web3 teams and companies that cannot obtain licenses in Singapore and face legal risks will naturally seek new, more business-friendly environments, and Dubai is undoubtedly one of the best options.
Singapore's 'one-size-fits-all' policy may impact some early innovative teams that are not 'scammers' but are temporarily unable to meet the high compliance costs, such as some decentralized protocol developers. For them, Dubai's lower operating costs and more relaxed innovation environment are very attractive.
As more leading companies shift their focus to Dubai, related industry talent, including developers, researchers, operations, and marketing personnel, will also flow there, further strengthening Dubai's role as a talent center. Therefore, Dubai's role as a 'buyer' is not simply to take over eliminated assets but to actively attract the world's best cryptocurrency resources, marking a strategic industrial takeover.
Overall, Singapore and Dubai, these two Asian financial and innovation centers, are putting on a spectacular 'A Tale of Two Cities'. This regulatory policy shift clearly outlines the profound reshaping of the global cryptocurrency landscape.
Singapore's choice is to return to its traditional positioning as a top global financial center, prioritizing financial stability and reputation, while adopting a more cautious and stringent filtering mechanism for high-risk Web3 innovations. Meanwhile, Dubai has seized this historic opportunity, actively embracing Web3 with its vision and courage, striving to become an innovative hub in the global digital economy era.
Behind this great migration is the inevitable trend of the cryptocurrency industry moving from barbaric growth to normalization and specialization. In the future, the global regulatory landscape may become more fragmented, with different jurisdictions playing different roles based on their own endowments and strategies. For cryptocurrency companies navigating the waves, the once-available 'regulatory arbitrage' space is shrinking, making it urgent to find a 'home' that can provide long-term stability, clear rules, and development prospects.