Nature of accepting crypto payments

How does MAS regulate businesses accepting crypto payments?

Cryptocurrencies are known as "digital payment tokens" in Singapore. Businesses accepting crypto payments are considered as "digital payment token transfer service".

Source: Comply Advantage

According to MAS (Notices)
last revised on 1 March 2022

'digital payment token transfer service' means the service of accepting digital payment token from one digital payment token address or account, whether in Singapore or outside Singapore, as principal or agent, for the purposes of transferring, or arranging for the transfer of, the digital payment token to another digital payment token address or account, whether in Singapore or outside Singapore

"MAS currently regulates service providers which deal with the exchange of cryptocurrencies when they possess the money or cryptocurrency.

Under the amendment, the authority's powers are expanded to include regulatory measures on such providers even if they may not posses the money or cryptocurrency involved."

It is worth to note that regulation even applies to cross-border money transfers where moneys do not flow through Singapore.

"'The Bill will broaden the definition of cross-border money transfer service to include facilitating transfers of money between persons in different jurisdictions, where money is not accepted or received by the service provider in Singapore,' said Mr Ong in Parliament."

Source: CNA, last revised on 4 Jan 2021

FinReg business tip

Retailers or individuals who opt to receive payments for goods/services or transactions in cryptocurrencies may fall under the scope of digital payment token regulations under the Payment Services Act. However, changes to the legislation may further encompass the act of accepting crypto payments to be a regulated activity.