Singapore Tightens Crypto Rules, Forces Firms to Relocate or Shut Down by 2025

Singapore has implemented stringent regulations on cryptocurrency firms, mandating that they either obtain a Digital Token Service Provider (DTSP) license or cease their offshore operations by June 30, 2025. The Monetary Authority of Singapore (MAS) has made it clear that there will be no grace period or temporary exemptions for non-compliant firms, which face fines of up to $200,000 or imprisonment for up to three years.

This regulatory shift is aimed at addressing the issue of regulatory arbitrage, where crypto firms use Singapore as a base to serve international users in regions where their services would not otherwise be licensed. MAS views this practice as undermining the credibility of Singapore’s financial ecosystem. The new rules are designed to eliminate grey zones and loopholes, particularly for platforms offering custodial services, derivatives, or leveraged products to clients outside Singapore.

DTSP licenses will be granted in "extremely limited" cases, effectively discouraging most global-facing firms from maintaining their operations in Singapore. The new regulations apply to a wide range of crypto firms, including crypto exchanges, OTC desks, custodial service providers, token project teams, prime brokerages, and liquidity providers. Several major players, such as Bitget, have already begun relocating their teams and operations out of Singapore to comply with the new rules and retain their global reach.

This crackdown marks a significant change in Singapore’s approach to crypto regulation, transitioning from a previously friendly environment to a more stringent one. The MAS’s decision to enforce these regulations without a transition period underscores the urgency and severity of the measures. The move is likely to have a profound impact on the global crypto industry, as Singapore has been a key hub for digital asset innovation. Firms that fail to comply will face severe penalties, including substantial fines and imprisonment, highlighting the MAS’s commitment to enforcing these new rules.