May 04, 2026
By Anjali Kochhar
Singapore is taking a major step toward integrating crypto into mainstream banking, as regulators move to create a more practical capital framework for digital assets.
The Monetary Authority of Singapore has launched a consultation proposing how banks should treat cryptoassets held on public blockchains. The goal is to make it easier for banks to engage with digital assets without facing overly strict capital requirements.
Under the proposed framework, certain cryptoassets such as stablecoins and tokenised traditional assets that meet risk standards could receive more favourable capital treatment. This marks a shift away from earlier global rules, particularly those set by the Basel Committee on Banking Supervision, which imposed heavy capital charges on crypto exposures.
The new approach introduces a more flexible, principle based system. Instead of classifying all crypto as high risk, MAS aims to differentiate assets based on their actual risk profile. As a result, safer digital assets may require banks to hold less capital against them, encouraging participation while maintaining safeguards.
However, the framework still includes strict controls. Banks will face limits on their crypto exposure, typically capped at around 2 percent of Tier 1 capital, to reduce systemic risk.
The proposed rules are expected to come into effect in 2027 after industry consultation. They reflect Singapore’s broader strategy of balancing innovation with financial stability, positioning the country as a global hub for regulated digital asset activity.
Overall, the move signals a growing acceptance of crypto within traditional finance. By offering a workable regulatory pathway, Singapore is enabling banks to explore blockchain based assets while maintaining strong risk management standards.
