Singapore's MAS Orders Crypto Firms to Exit Overseas Markets or Obtain Licence by June 2025

Singapore's Monetary Authority (MAS) has issued a stern directive to all entities offering digital token services to overseas clients. As of June 30, 2025, these entities must either obtain a Digital Token Service Provider (DTSP) licence under the Financial Services and Markets (FSM) Act 2022 or cease all cross-border operations immediately. This mandate leaves no room for interpretation, with MAS explicitly stating that there will be no grace period, transitional arrangements, or extensions. The directive applies to all entities incorporated in Singapore, regardless of the scale of their overseas business activity. This move aims to close a regulatory gap that allowed Singapore-based crypto companies to serve global users while avoiding stricter rules in other jurisdictions.

Under the new rules, a DTSP is broadly defined to include any entity offering token-related services abroad, regardless of size, structure, or direct user involvement. This encompasses centralized crypto exchanges, DeFi platforms, wallet providers, token issuers, and even non-crypto firms if they offer token-related services to clients outside Singapore. The regulatory focus is on the place of incorporation, not where servers are located or where the end-user resides. MAS has emphasized that the business model or revenue size does not exempt compliance, and enforcement action will be taken against any DTSP that has not registered or exited overseas operations by the June deadline.

Despite industry lobbying, MAS has refused all requests for phased implementation. The regulator dismissed concerns about the abrupt timeline, stating that allowing token services to continue during a transition would expose the market to unacceptable risks, particularly related to financial crime. As a result, firms must either exit the overseas crypto market entirely or complete the licensing process before June 30. There will be no exceptions. Violating the June 30 deadline is a criminal offense under Singapore law, with firms facing fines of up to SGD 250,000 (approximately USD 200,000) and imprisonment for up to three years. These penalties will be applied regardless of the size of the business or the scope of the violation, elevating the decision to a legal survival question.

While MAS has not officially suspended licensing, it has made clear that approvals for DTSPs will be extremely rare due to unresolved Anti–Money Laundering (AML) and Counter–Terrorism Financing (CFT) concerns. This effectively imposes a de facto licensing ban, with MAS stating that it will generally not issue a licence given the inherent difficulty of regulating offshore token services and the related crypto legal risks in 2025. The crypto licensing challenges now facing firms in the city-state are among the most stringent in the world.

Singapore’s regulatory crackdown stems from a central concern: regulatory arbitrage. MAS has long feared that crypto companies would register in Singapore, gaining reputational legitimacy from its financial ecosystem, while serving overseas clients under weaker or no regulatory oversight. This loophole allowed firms to market themselves as MAS-compliant without being subject to crypto service provider compliance in the countries where they operate. To combat this, the Financial Services and Markets Act 2022 gave MAS direct oversight of cross-border digital token activity, via Section 137. This legal mechanism empowers the authority to impose full compliance requirements, regardless of where users, servers, or funds are located. MAS is aiming to protect Singapore’s standing as a trusted financial hub.

The immediate impact of MAS’s policy shift is already visible. One of the most high-profile cases is WazirX, a crypto exchange previously registered in Singapore but primarily serving users in India. After a Singapore court blocked its restructuring, the company relocated operations to Panama. Its parent firm was restructured under Zensui, a new entity based outside Singapore. A growing number of crypto firms are restructuring or relocating to offshore jurisdictions such as Panama, China Hong Kong and Dubai, all seen as more permissive environments for digital asset businesses. Industry giants like Bybit and Bitget have started withdrawing teams from Singapore, citing licensing uncertainty and MAS crypto compliance rules as core obstacles. This trend is dubbed a “crypto exodus,” as companies seek jurisdictions with more flexible frameworks. Meanwhile, neighboring countries are experimenting with more accessible crypto policies, allowing retail usage like credit card-based crypto spending for tourists, while others are moving to enhance crypto licensing and AML oversight.