Paxos, a renowned crypto infrastructure firm, is making significant strides in the Singaporean market, having recently received in-principle approval from the Monetary Authority of Singapore (MAS) for its new entity, Paxos Digital Singapore Pte. Ltd. This development marks a crucial step towards Paxos’s goal of launching a U.S. dollar-backed stablecoin in Singapore.
The MAS’s initial approval positions Paxos Digital Singapore to provide digital payment token services within the framework of Singapore’s upcoming regulations for stablecoins. Upon receiving full regulatory approval, Paxos intends to collaborate with enterprise clients in Singapore to issue this new stablecoin.
Walter Hessert, the Head of Strategy at Paxos, emphasized the growing global demand for the U.S. dollar and the challenges consumers outside the U.S. face in accessing the currency reliably and securely. He stated, “This in-principle approval from the MAS will allow Paxos to bring its regulated platform to more users around the world.”
The MAS had previously outlined its final regulatory framework on August 15 for stablecoins not issued by banks. This framework focuses on tokens pegged to the Singapore dollar or G10 currencies (like the euro, British pound, and U.S. dollar), specifically targeting those whose circulation surpasses SGD 5 million (approximately $3.7 million).
Paxos, which is known for its stringent adherence to regulatory compliance, has previously been involved in notable stablecoin projects. On August 7, PayPal launched its own USD-backed stablecoin, PYUSD, issued by Paxos. However, Paxos faced a regulatory challenge when the New York Department of Financial Services instructed it to cease issuing Binance’s BUSD stablecoin, labeling it an unregistered security.
In response to these regulatory demands, Paxos has consistently maintained that all its stablecoins are fully backed by the U.S. dollar and cash equivalents. The firm commits to issuing monthly attestations and reserve reports to demonstrate compliance with regulatory standards.
This latest move by Paxos in securing the in-principle approval from MAS signifies the firm’s commitment to expanding its global footprint, particularly in regions like Singapore, which are rapidly emerging as significant hubs in the digital asset space.