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Paxos to issue USD stablecoin in Singapore, wins initial approval

November 16, 2023 Coin Telegraph

Coin Telegraph

The USD-backed token will comply with Singapore’s upcoming stablecoin laws and be issued through a new local Paxos entity that’s received initial approval.

Crypto infrastructure firm Paxos has secured in-principle approval from Singapore’s regulator for a new entity that’s planning the launch of a U.S. dollar-backed stablecoin.

In a Nov. 15 statement, Paxos said it received an initial nod from the Monetary Authority of Singapore (MAS) for its new entity Paxos Digital Singapore Pte. Ltd. The new firm can offer digital payment token services and plans to issue a USD stablecoin cleared under the MAS’ proposed stablecoin regulations.

Upon receiving full approval, Paxos said it will be able to partner with enterprise clients to issue the stablecoin in Singapore.

“Global demand for the U.S. dollar has never been stronger, yet it remains difficult for consumers outside the U.S. to get dollars safely, reliably and under regulatory protections,” said Paxos head of strategy Walter Hessert. “This in-principle approval from the MAS will allow Paxos to bring its regulated platform to more users around the world.”

On Aug .15, MAS announced its final framework for regulating stablecoins aimed at non-bank issued tokens pegged to the value of the Singapore dollar or G10 currencies such as the euro, British pound and U.S. dollar and whose circulation exceeds 5 million Singapore dollars ($3.7 million).

@MAS_sg has announced the features of a new regulatory framework that seeks to ensure a high degree of value stability for #stablecoins regulated in #Singapore. https://t.co/j12QambGIJ pic.twitter.com/LBUoOGY16P
— MAS (@MAS_sg) August 15, 2023

On Aug. 7, PayPal launched its USD-backed stablecoin — PYUSD — issued by Paxos.

Paxos formerly minted Binance’s now-defunct BUSD stablecoin but was ordered by the New York Department of Financial Services to cease issuance of the token after the agency declared the stablecoin an unregistered security.

Paxos clarified that all of its stablecoins are fully backed by the U.S. dollar and cash equivalents, adding that it issues monthly attestations and reserve reports to ensure compliance.

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Singapore central bank releases regulatory framework for stablecoins

August 15, 2023 Coin Telegraph

Coin Telegraph

The framework outlines requirements for stablecoin issuers to meet to be deemed as regulated by the Monetary Authority of Singapore.

Singapore's central bank has released a revised regulatory framework aimed at ensuring stability for single-currency stablecoins regulated in the city-state.

The Monetary Authority of Singapore announced the framework on Aug. 15 and said it will police single-currency stablecoins (SCS) pegged to the value of the Singapore dollar or G10 currencies such as the euro, British pound and United States dollar.

*Excerpt from statement regarding its stablecoin regulatory framework. Source: MAS*

“MAS’ stablecoin regulatory framework aims to facilitate the use of stablecoins as a credible digital medium of exchange, and as a bridge between the fiat and digital asset ecosystems," said the bank's deputy managing director of financial supervision Ho Hern Shin.

"We encourage SCS issuers who would like their stablecoins recognized as 'MAS regulated stablecoins' to make early preparations for compliance,” Shin added.

The framework outlines several requirements that stablecoin issuers would have to adhere to, including timely redemptions and robust reserve management, among others:

Value stability: Reserve assets will be subject to requirements relating to their composition, valuation, custody and audit, to give a high degree of assurance of value stability.
Capital: Stablecoin issuers must maintain minimum base capital and liquid assets to reduce the risk of insolvency and enable an orderly wind-down of business if necessary.
Redemption at Par: Issuers must return the par value of the stablecoins to holders within five business days from a redemption request.
Disclosure: Issuers must provide appropriate disclosures to users, including information on the SCS’ value stabilizing mechanism, rights of SCS holders, as well as the audit results of reserve assets.

MAS noted only stablecoin issuers that fulfill the requirements under the framework will be able to apply to become MAS-regulated.

"This label will enable users to readily distinguish MAS-regulated stablecoins from other digital payment tokens, including 'stablecoins' which are not subject to MAS’ stablecoin regulatory framework," it said.

It also warns any person that represents a token as being MAS-ceritified would be subject to penalties set out in the new framework, along with being added to an alert list.

The revised regulatory framework accounts for feedback from an October 2022 public consultation.

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This is a developing story, and further information will be added as it becomes available.

Ripple gets in-principle nod for digital asset services in Singapore

June 22, 2023 Coin Telegraph

APAC

Ripple says the “in principle” approval will help scale its “On-Demand Liquidity,” the service it uses to source XRP liquidity to customers.

Blockchain-based payments firm Ripple has obtained in-principle regulatory approval from Singapore’s financial regulator to offer digital asset payments and token products in the city-state.

Ripple confirmed the approval from the Monetary Authority of Singapore (MAS) in a June 22 statement. The approval will allow its subsidiary, Ripple Markets Asia Pacific, to further scale its On-Demand Liquidity. The ODL helps Ripple’s customers to move XRP around the world without the banks intervening as intermediaries.

We’re honored to obtain In-Principle Approval of a Major Payments Institution License from the @MAS_sg – allowing us to offer regulated digital asset products and services, and scale customer use of #ODL.

Learn more: https://t.co/8Ylc3lZSeg
— Ripple (@Ripple) June 22, 2023

The firm applied for the institutional payment license under Singapore’s Payment Service Act.

Ripple CEO Brad Garlinghouse praised the Singaporean regulator for its “pragmatic, innovation-first approach” to cryptocurrency-related services, adding that the country will provide a “prominent gateway” for Ripple’s business operations in the Asia Pacific region.

Ripple’s chief legal officer, Stu Alderoty, also noted that Singapore’s “early leadership” is paving the way for other regulators looking to develop a “clear taxonomy and licensing framework.”

1/ @MAS_sg has built a workable framework that truly unites consumer protection, market integrity and innovation. They’ve also outlined a clear taxonomy to classify and regulate digital assets – making it possible for companies like Ripple to build and offer compliant products. https://t.co/KLYzWRrST0
— Stuart Alderoty (@s_alderoty) June 22, 2023

Alderoty explained that the approval expands upon Ripple’s customer reach.

“This in-principle regulatory approval from the MAS will enable us to better support our forward-thinking customers looking to hone in on blockchain and crypto technologies to build a more inclusive and borderless financial system.”

In 2022, Ripple managed to double the number of employees in its Asia Pacific headquarters as its Singapore base experienced a majority share of ODL transactions flowing through the city-state.

The MAS released its own Purpose Bound Money white paper on June 21, which proposes standards for fintech firms providing digital money services in Singapore:

.@MAS_sg published a whitepaper proposing a common protocol to specify conditions for the use of digital money such as CBDCs, tokenised bank deposits, and stablecoins on a distributed ledger.

READ: https://t.co/ZzY0OjOG1n
— MAS (@MAS_sg) June 21, 2023

While Ripple’s path to compliance with Singapore came without much in the way of legal barriers, this hasn’t been the case elsewhere.

Ripple’s legal team has had their hands tied with the U.S. Securities Exchange Commission since December 2020 after the regulator sued them for allegedly offering XRP — the token that powers XRP Ledger — as an unregistered security.

A ruling is set to be made on the high-profile case in the coming months, according to Garlinghouse.

On June 15, Ripple partnered with Colombia’s central bank, Banco de la República, to pilot a central bank digital currency on its XRP Ledger.

The firm has also partnered with central banks in Montenegro and Thailand, in addition to many other regional banks and financial institutions around the world.

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