The Monetary Authority of Singapore (MAS) has issued new regulations for Digital Token Service Providers (DTSPs), effective June 30, 2025, marking a significant shift in the country’s approach to Web3 businesses. The regulations, announced on May 30, 2025, come with no grace period, potentially triggering a mass exodus of crypto-related businesses from Singapore.

The comprehensive DTSP framework applies to both individuals and partnerships operating in Singapore, as well as Singapore-registered companies providing digital token services overseas. Notably, the definition of ‘business premises’ includes any location used for business activities, even temporary setups like market stalls, significantly expanding regulatory oversight.

Key implications include:
– Unlicensed entities cannot conduct digital token services in Singapore for either local or international clients
– Remote workers employed by foreign companies may continue home-based operations
– Content creators and analysts publishing token-related research may require DTSP licenses

High-risk groups affected include independent developers, project consultants, market makers, KOLs, and unlicensed exchanges. The regulations represent a dramatic departure from Singapore’s previous reputation as a crypto-friendly hub, with MAS adopting an ‘extremely cautious’ approach to license approvals.

Legal experts note significant ambiguities in the regulations, particularly regarding definitions of ’employees’ and ‘business activities,’ leaving room for case-by-case enforcement. The Blockchain Association of Singapore has raised concerns about the broad interpretation of regulated services, including research publications.

This regulatory shift effectively ends Singapore’s era as a jurisdiction for regulatory arbitrage in the Web3 space, forcing businesses to either comply with stringent requirements or relocate operations.