Singapore
Retail_Trading_Status
- Analysis ID
- #782
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- 2025-12-12 05:13
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- 2fd0908f...
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Executive Summary
Cryptocurrency retail trading is legal and highly regulated in Singapore under the Payment Services Act (PSA) 2019. The Monetary Authority of Singapore (MAS) enforces a strict licensing regime for Digital Payment Token (DPT) service providers, with numerous major global exchanges holding Major Payment Institution (MPI) licenses. While retail access is permitted, it is subject to rigorous consumer protection measures implemented in 2024-2025, including bans on leverage, credit card purchases, and trading incentives, alongside mandatory risk awareness assessments.
Key Pillars
Monetary Authority of Singapore (MAS) as the primary regulator
Payment Services Act (PSA) 2019 for domestic DPT service licensing
Financial Services and Markets Act (FSMA) 2022 for cross-border/overseas DPT services
Mandatory AML/CFT compliance (Notice PSN02) and Travel Rule implementation
Consumer protection measures: Asset segregation (statutory trust), risk assessments, and bans on retail leverage/credit
Landmark Laws
Payment Services Act 2019 (Act 2 of 2019) - Enacted: 2020-01-28
- The foundational framework regulating payment systems and digital payment token services. It establishes the licensing regime (Standard and Major Payment Institutions) for crypto exchanges and brokers.
- Source
Financial Services and Markets Act 2022 (Act 18 of 2022) - Enacted: 2022-04-05
- Expands regulatory oversight to include virtual asset service providers in Singapore that conduct business only overseas, closing a previous regulatory gap.
- Source
Guidelines on Consumer Protection Measures for DPT Service Providers (Guidelines No. FSG-G01) - Enacted: 2024-10-04
- Specifies restrictions on retail access, including the prohibition of incentives, leverage, and credit card payments, and mandates risk awareness assessments.
- Source
Considerations
Retail Friction: Retail investors cannot use credit cards or leverage for crypto trading; 'risk awareness' tests are mandatory.
Taxation: No capital gains tax, but frequent trading profits may be taxed as income; payment tokens are exempt from GST.
Stablecoins: A specific regulatory framework exists for single-currency stablecoins (SCS) pegged to the SGD or G10 currencies.
Travel Rule: Strict enforcement of the FATF Travel Rule requires value transfer information sharing for transactions.
Asset Custody: Customer assets must be held in a statutory trust and segregated from the exchange's own assets.
Notes
The analysis assumes the current date is December 12, 2025. By this date, the phased implementation of consumer protection rules (which began in late 2024 and continued through mid-2025) is fully in force. Singapore distinguishes itself by not banning retail access but making it deliberately 'high-friction' to discourage impulse trading.
Remaining Uncertainties
- The specific threshold for when a 'retail' investor might qualify as an 'accredited' investor specifically for crypto products can be complex to prove for some individuals.
- Long-term enforcement efficacy of the ban on foreign-issued credit cards (if applicable) or workarounds used by retail users via P2P markets.
Detailed Explanation
Detailed Explanation
Cryptocurrency retail trading is legal and highly regulated in Singapore. The primary regulatory framework is established by the Payment Services Act (PSA) 2019, enacted on 2020-01-28, which mandates a licensing regime for Digital Payment Token (DPT) service providers under the oversight of the Monetary Authority of Singapore (MAS). The Financial Services and Markets Act (FSMA) 2022, enacted on 2022-04-05, expanded this oversight to include service providers that conduct business only overseas. The MAS enforces strict compliance requirements, including Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) rules under Notice PSN02 and mandatory implementation of the FATF Travel Rule for value transfer information sharing. A core consumer protection framework is provided by the Guidelines on Consumer Protection Measures for DPT Service Providers (Guidelines No. FSG-G01), enacted on 2024-10-04, which introduced significant restrictions for retail access. By the current date of December 12, 2025, the phased implementation of these consumer protection measures is fully in force. These measures are designed to create a 'high-friction' environment for retail investors, deliberately discouraging impulse trading while maintaining legal access. Key requirements from these guidelines include mandatory risk awareness assessments for retail customers, a ban on providing leverage or credit facilities for crypto trading, a prohibition on accepting credit card payments for purchases, and a ban on offering trading incentives. Furthermore, DPT service providers must segregate customer assets from their own by holding them in a statutory trust. For stablecoins, Singapore has established a specific regulatory framework for single-currency stablecoins (SCS) pegged to currencies like the SGD. Regarding taxation, there is no capital gains tax, but profits from frequent trading may be taxed as income, and payment tokens are exempt from GST.
Summary Points
I. Regulatory Status
* Cryptocurrency retail trading is Allowed-Regulated in Singapore.
* It is legal but subject to a highly regulated and strict licensing regime.
* The regulatory approach does not ban retail access but makes it deliberately 'high-friction' to discourage impulse trading.
II. Key Regulatory Bodies
* Monetary Authority of Singapore (MAS): The primary regulator enforcing the licensing and compliance framework.
III. Important Legislation
* Payment Services Act 2019 (Act 2 of 2019): Enacted 2020-01-28. This is the foundational framework regulating payment systems and digital payment token (DPT) services. It establishes the licensing regime (Standard and Major Payment Institutions) for crypto exchanges and brokers.
* Financial Services and Markets Act 2022 (Act 18 of 2022): Enacted 2022-04-05. Expands regulatory oversight to include virtual asset service providers in Singapore that conduct business only overseas, closing a previous regulatory gap.
* Guidelines on Consumer Protection Measures for DPT Service Providers (Guidelines No. FSG-G01): Enacted 2024-10-04. Specifies restrictions on retail access, including the prohibition of incentives, leverage, and credit card payments, and mandates risk awareness assessments. By December 2025, its phased implementation is fully in force.
IV. Compliance Requirements
* Licensing: DPT service providers must obtain a license under the Payment Services Act 2019 (e.g., Major Payment Institution license).
* AML/CFT: Mandatory compliance with AML/CFT rules, specifically Notice PSN02.
* Travel Rule: Strict enforcement of the FATF Travel Rule requires value transfer information sharing for transactions.
* Asset Custody: Customer assets must be held in a statutory trust and segregated from the exchange's own assets.
* Risk Assessments: Mandatory 'risk awareness' assessments for retail customers are required.
* Stablecoins: A specific regulatory framework exists for single-currency stablecoins (SCS) pegged to the SGD or G10 currencies.
V. Notable Restrictions or Limitations
* Retail Leverage: A ban on providing leverage or credit facilities for retail crypto trading.
* Credit Card Payments: A prohibition on accepting credit card payments for purchasing cryptocurrencies.
* Trading Incentives: A ban on offering incentives (e.g., referral bonuses) to retail customers.
VI. Recent Developments or Notes
* The phased implementation of consumer protection rules from the 2024 guidelines began in late 2024 and continued through mid-2025. By December 2025, these rules are fully in force.
* Taxation: There is no capital gains tax, but profits from frequent trading may be taxed as income. Payment tokens are exempt from GST.
* Singapore distinguishes itself by not banning retail access but making it deliberately 'high-friction'.
Full Analysis Report
Full Analysis Report
As of late 2025, Singapore maintains a status of 'Allowed-Regulated' for retail cryptocurrency trading, characterized by a sophisticated and strictly enforced licensing regime. The Monetary Authority of Singapore (MAS) regulates the sector primarily through the Payment Services Act (PSA) 2019, which requires any entity facilitating the exchange of Digital Payment Tokens (DPTs) to obtain either a Standard Payment Institution (SPI) or Major Payment Institution (MPI) license. A significant number of global entities, including Coinbase, Crypto.com, Circle, and Blockchain.com, have successfully secured MPI licenses, validating the operational viability of the framework.
While retail participation is legal, the regulatory environment has shifted significantly towards 'friction-based' consumer protection between 2024 and 2025. Following public consultations, MAS implemented measures designed to curb speculative retail trading without imposing an outright ban. These measures include a prohibition on DPT service providers offering financing, margin, or leverage to retail customers. Furthermore, operators are banned from accepting locally issued credit card payments for crypto purchases and from offering incentives (such as sign-up bonuses or free tokens) that might encourage trading.
Operational requirements for licensed entities are stringent. DPT service providers must safeguard customer assets in a statutory trust, segregated from the firm's own funds, with daily reconciliation requirements. This 'statutory trust' requirement is a direct response to global crypto failures, ensuring that customer funds remain protected in the event of an exchange's insolvency. Additionally, providers must conduct a 'risk awareness assessment' for all retail customers; those who do not pass the assessment are generally precluded from trading until they demonstrate sufficient understanding.
The Financial Services and Markets Act (FSMA) complements the PSA by regulating Singapore-based entities that provide digital token services purely to markets outside Singapore. This ensures that Singapore cannot be used as a regulatory arbitrage hub for 'offshore' unregulated activities. Tax treatment remains favorable for long-term holders, as Singapore has no capital gains tax, though professional traders or those deriving income from trading are subject to income tax. The Goods and Services Tax (GST) Act was also amended previously to exempt the supply of digital payment tokens from GST, facilitating their use as a medium of exchange.
As of late 2025, Singapore maintains a status of 'Allowed-Regulated' for retail cryptocurrency trading, characterized by a sophisticated and strictly enforced licensing regime. The Monetary Authority of Singapore (MAS) regulates the sector primarily through the Payment Services Act (PSA) 2019, which requires any entity facilitating the exchange of Digital Payment Tokens (DPTs) to obtain either a Standard Payment Institution (SPI) or Major Payment Institution (MPI) license. A significant number of global entities, including Coinbase, Crypto.com, Circle, and Blockchain.com, have successfully secured MPI licenses, validating the operational viability of the framework. While retail participation is legal, the regulatory environment has shifted significantly towards 'friction-based' consumer protection between 2024 and 2025. Following public consultations, MAS implemented measures designed to curb speculative retail trading without imposing an outright ban. These measures include a prohibition on DPT service providers offering financing, margin, or leverage to retail customers. Furthermore, operators are banned from accepting locally issued credit card payments for crypto purchases and from offering incentives (such as sign-up bonuses or free tokens) that might encourage trading. Operational requirements for licensed entities are stringent. DPT service providers must safeguard customer assets in a statutory trust, segregated from the firm's own funds, with daily reconciliation requirements. This 'statutory trust' requirement is a direct response to global crypto failures, ensuring that customer funds remain protected in the event of an exchange's insolvency. Additionally, providers must conduct a 'risk awareness assessment' for all retail customers; those who do not pass the assessment are generally precluded from trading until they demonstrate sufficient understanding. The Financial Services and Markets Act (FSMA) complements the PSA by regulating Singapore-based entities that provide digital token services purely to markets outside Singapore. This ensures that Singapore cannot be used as a regulatory arbitrage hub for 'offshore' unregulated activities. Tax treatment remains favorable for long-term holders, as Singapore has no capital gains tax, though professional traders or those deriving income from trading are subject to income tax. The Goods and Services Tax (GST) Act was also amended previously to exempt the supply of digital payment tokens from GST, facilitating their use as a medium of exchange.
Source Evidence
Primary and secondary sources cited in this analysis
"Licence Type: Major Payment Institution; Activity: Digital Payment Token Service"
"DPT service providers should not offer any incentives to retail customers to trade in DPTs... [and] should not provide any credit facility to a retail customer."
"An Act to provide for the licensing and regulation of payment service providers, the oversight of payment systems..."
"Starting from mid-2024, the newly introduced rules will forbid cryptocurrency platforms... from accepting purchases made with locally issued credit cards."
Web Sources (8)
Sources discovered via web search grounding
Search queries used (4)
- Singapore crypto retail trading regulation MAS 2024 2025
- MAS regulatory measures for digital payment token services retail customers
- list of licensed Major Payment Institutions digital payment token service Singapore
- Singapore Payment Services Act crypto retail restrictions
https://fintechnews.sg/63023/crypto/here-are-all-the-licensed-crypto-services-providers-in-singapore/
https://www.signzy.com/blogs/singapore-cryptocurrency-regulations
https://www.mas.gov.sg/news/media-releases/2023/mas-strengthens-regulatory-measures-for-digital-payment-token-services
https://cryptoadventure.com/singapore-crypto-regulations-2025-guide-for-investors/
https://www.straitstimes.com/business/more-s-pore-consumer-protection-rules-for-retail-crypto-investors-from-june-2025
https://www.drewnapier.com/DrewNapier/media/DrewNapier/6Dec23-Upcoming-Regulatory-Measures-for-Digital-Payment-Token-Service-Providers-(Part-2).pdf
https://coinmarketcap.com/academy/article/singapore-implements-new-rules-to-safeguard-retail-investors-in-cryptocurrency-trading
https://www.businesstimes.com.sg/singapore/regulations-digital-payment-token-service-providers-expanded-include-foreign-customers