Singapore central bank approves Circle and Paxos stablecoins

Singapore
Fin is an experienced reporter with a focus on the frontlines of global business news and cutting-edge technological trends. He has published engaging interviews with leading industry figures from the likes of CBS, Rakuten, Spotify, and more. When not tapping away behind a laptop, he can be found exploring web3 and the cryptocurrency markets. You can follow his Twitter @FinStrathern or connect with him at https://www.linkedin.com/in/finstrathern/.

The Singapore central bank (Monetary Authority of Singapore) has approved licences for two stablecoin issuers, Circle and Paxos, to operate in the city-state.

US-based Circle, the issuer behind USD Coin (USDC), was granted approval for a major payments institution licence, meaning it can issue cryptocurrencies and facilitate domestic or cross-border payments.

Also a US firm, Paxos develops the Pax Dollar (USDP) and has received a licence to offer digital payment token services.

Both Circle and Paxos announced their approvals on 2 November, a week after the Monetary Authority of Singapore (MAS) published consultation papers proposing to regulate digital payment token service providers and stablecoin issuers.

Such regulation would fall under Singapore’s Payment Services Act (PSA), which was passed in 2019 to give the MAS the authority to oversee the operations of payment service providers.

Thanks to the licences, Circle and Paxos will now be able to offer their stablecoins alongside other digital payment token products and services in Singapore.

Circle CEO Jeremy Allaire said that the licence will be “instrumental to Circle’s regional and global expansion plans in raising global economic prosperity.”

Dante Disparte, Circle’s chief strategy officer and global head of public policy, added that USDC’s approval opens up huge potential for cryptocurrencies to drive economic growth in Singapore.

On Paxos’ side, Paxos Asia CEO Rich Teo said: “We’re excited to have MAS as our regulator, and with their oversight, we’ll be able to safely accelerate consumer adoption of digital assets globally in partnership with the world’s biggest enterprises.”

The move from the Singapore central bank comes after a series of stricter decisions on crypto in the country.

Earlier in summer, MAS’ chief fintech officer Sopnendu Mohanty promised to be “brutal and unrelentingly hard” on poor business practices from within the crypto sector.

In December 2021, the MAS also turned down more than 100 of 170 applicants that applied for digital payment token service licences in the city-state.

Singapore is keen to maintain its status as an innovative financial hub and crypto-advocate, but it must do so cautiously. In September, the country’s largest bank, DBS, decided to expand its crypto trading services only to accredited investors within a strict set of guidelines.

Photo by Fin Strathern.

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