Singapore Tightens Stablecoin Oversight Amid Financial Stability Concerns
Singapore's Monetary Authority (MAS) has drawn a regulatory line in the sand, declaring that only fully supervised stablecoins should be considered reliable for large transactions. The warning comes as part of a broader push to separate settlement-grade instruments from the rest of the cryptocurrency market.
MAS Managing Director Chia Der Jiun delivered a blunt assessment during the Singapore FinTech Festival, comparing unstable coin pegs to 2008-era money market fund runs. "These instruments are not suitable as SAFE settlement assets," he stated, emphasizing the need for credible reserve backing and redemption mechanisms.
The city-state is preparing legislation to enforce strict reserve requirements, building on an August regulatory framework. The MOVE signals Singapore's intent to favor well-capitalized issuers while maintaining openness to cross-border cooperation as stablecoins gain systemic importance.
