Singapore Tightens Crypto Rules: Jail Time or $200K Fine for Non-Compliant Firms

Singapore’s Crackdown on Offshore Crypto Activity: Comply or Leave

Singapore, long seen as a friendly hub for crypto innovation, is now taking a hard stance on digital asset firms. The Monetary Authority of Singapore (MAS) has announced a regulatory shift that gives crypto companies only two choices: either obtain a Digital Token Service Provider (DTSP) license or shut down offshore operations by June 30, 2025.

This is not a phased regulation update — it’s an abrupt and aggressive compliance demand. There will be no grace period, no transition window, and no temporary exemptions. According to MAS, non-compliance will result in a fine of up to $200,000 or three years of imprisonment.

Why Is Singapore Enforcing This Now?

The crackdown stems from the issue of regulatory arbitrage. Many crypto firms have used a Singapore base to serve international users in regions where their services wouldn’t otherwise be licensed. For MAS, this strategy undermines the credibility of Singapore’s financial ecosystem.

This new rule aims to eliminate grey zones and loopholes, especially for platforms offering custodial services, derivatives, or leveraged products to clients outside Singapore.

MAS has stated that DTSP licenses will be approved only in “extremely limited” cases, effectively discouraging most global-facing firms from maintaining their operations in Singapore.

What Crypto Firms Are Affected?

The new rules apply to any Singapore-based crypto firm serving users outside the country, including:

• Crypto exchanges (like Bitget)
• OTC desks
• Custodial service providers
• Token project teams
• Prime brokerages and liquidity providers

Several major players, including Bitget, have already started relocating their teams and operations out of Singapore to remain compliant and retain their global reach.

Where Are These Firms Moving?

The enforcement has triggered a migration wave among Web3 firms. Here are the top alternative hubs:

1. Dubai: 0% tax, transparent crypto regulations, large talent pool
2. Hong Kong: Asia-facing regulations, aligned with Beijing’s digital asset strategy
3. British Virgin Islands / Seychelles: Popular for offshore structuring and DAO setups
4. Mauritius: Emerging destination for cross-border custody and infrastructure

Meanwhile, countries like Japan, South Korea, Vietnam, and the Philippines already have stricter regulations in place. Until now, Singapore was the final flexible outpost in Asia for global crypto operations — but that era has ended.

What This Means for the Global Crypto Industry

The MAS decision marks a defining shift in Asia’s crypto landscape. Crypto companies will now need to reconsider where they base their operations, particularly if they offer leveraged products, custody services, or global access.

This is not just a crackdown — it's a compliance cliff. Firms that fail to act before the June 30 deadline risk losing their access to Singapore’s ecosystem or facing serious legal consequences.

Conclusion

Singapore’s decision is a turning point for crypto regulation in Asia. The country’s transformation from a flexible fintech hub to a tightly regulated market will reshape how global crypto businesses operate. If you're a Web3 team serving international clients, Singapore is no longer the safe regulatory haven it once was.

Crypto firms must now act fast: get licensed, shut down offshore services, or move operations to a more welcoming jurisdiction.

$Bitget