Part 1
If you are planning to obtain a MAS crypto licence in Singapore, one of the most important—but often misunderstood, questions is this:
What activities can we actually offer under an SPI or MPI licence—and how do they interact with DPT (crypto) activities?
At first glance, most founders assume that a DPT licence is limited to crypto-related services such as trading, custody, or transfers.
But this is where the misunderstanding begins.
Because under the Payment Services Act (PSA), MAS does not issue a “crypto-only” licence.
Instead, it regulates a broader category of:
Payment services—of which Digital Payment Token (DPT) services are just one component.
This means that once you are licensed as a Standard Payment Institution (SPI) or Major Payment Institution (MPI), you may be able to offer multiple payment services alongside your crypto activities—provided they are properly structured, approved, and aligned with MAS expectations.
Understanding this is critical, because it directly impacts:
- Your business model
- Your licensing strategy
- Your revenue streams
- Your regulatory obligations
This article breaks down all the payment services under the PSA, explains how they fit within SPI and MPI licences, and shows how they interact with crypto (DPT) activities in practice.
The First Principle: There Is No “Crypto Licence” Under the PSA
Before we go deeper, it is important to reset one common misconception.
There is no standalone licence called:
- “Crypto licence”
- “Exchange licence”
- “DPT licence”
Instead, MAS grants:
A Payment Services Licence covering one or more regulated payment activities.
What This Means
When you apply for a MAS crypto licence, you are actually applying to conduct:
- One or more payment services
- Which may include Digital Payment Token services
Why This Matters
Because your licence can include:
- DPT services (crypto-related)
- Non-DPT payment services (fiat-related)
And the interaction between these services is where:
Most regulatory complexity—and opportunity—exists.
Overview: All Payment Services Under the PSA
The PSA defines seven regulated payment services.
These are the building blocks of your licence.
1. Account Issuance Service
This includes:
- Issuing payment accounts (e.g., e-wallets)
- Holding customer funds
- Providing stored value accounts
2. Domestic Money Transfer Service
This involves:
- Local fund transfers within Singapore
- Payment processing between accounts
3. Cross-Border Money Transfer Service
This includes:
- International remittance
- Sending funds across jurisdictions
4. Merchant Acquisition Service
This involves:
- Processing payments for merchants
- Enabling merchants to accept payments
5. E-Money Issuance Service
This includes:
- Issuing digital money stored electronically
- Maintaining stored value for users
6. Digital Payment Token (DPT) Service
This includes:
- Buying or selling crypto
- Facilitating crypto transactions
- Operating exchanges
- Transferring digital assets
7. Money-Changing Service
This includes:
- Buying or selling foreign currency
Key Insight
A MAS licence is not limited to crypto.
It is a combination of payment services—of which DPT is only one.
SPI vs MPI: What Changes Across Licence Types
Before we break down each activity, you need to understand how SPI and MPI licences differ.
Standard Payment Institution (SPI)
- Designed for smaller-scale businesses
- Subject to transaction thresholds
- Lower capital requirement (SGD 100,000)
Major Payment Institution (MPI)
- Designed for scalable businesses
- No transaction limits
- Higher capital requirement (SGD 250,000)
Important Clarification
Both SPI and MPI can offer:
The same categories of payment services
The difference lies in:
- Scale
- Limits
- Compliance intensity
Key Insight
SPI vs MPI is not about what you can do.
It is about how much you can do—and how you are regulated.
Now Let’s Break Down Each Activity (And Its Interaction With DPT Services)
1. Account Issuance Services (Wallets & Stored Value)
This is one of the most important services for crypto businesses.
What It Covers
- Issuing user accounts or wallets
- Holding customer funds (fiat or crypto-linked)
- Managing balances
How It Interacts With DPT Activities
In a crypto exchange:
- Users deposit fiat into accounts
- Funds are stored before trading
- Balances are maintained within the platform
Example
A user:
- Deposits SGD into your platform
- Uses it to buy Bitcoin
- Holds the balance before withdrawal
This flow involves:
- Account issuance (fiat wallet)
- DPT service (crypto trading)
Regulatory Complexity
MAS will assess:
- Whether funds are safeguarded
- Whether accounts are segregated
- Whether custody is properly managed
Key Insight
Account issuance is often the bridge between fiat and crypto activities.
2. Domestic Money Transfer Services
What It Covers
- Local fund transfers within Singapore
- Movement of funds between accounts
How It Interacts With DPT Activities
In crypto platforms:
- Users may transfer funds internally
- Funds may move between accounts before trading
- Settlement processes may involve domestic transfers
Example
- User deposits SGD
- Funds are transferred internally
- Then used for crypto purchase
Why This Matters
Because MAS needs to understand:
- How funds move before conversion
- Where risk points exist
Key Insight
Domestic transfers often support crypto trading—but are regulated separately.
3. Cross-Border Money Transfer Services
What It Covers
- Sending funds internationally
- Receiving funds from overseas
How It Interacts With DPT Activities
Crypto is inherently cross-border.
This creates overlap between:
- Fiat remittance
- Crypto transfers
Example
A user:
- Sends SGD from Singapore
- Converts to crypto
- Transfers crypto overseas
This Involves
- Cross-border transfer (fiat)
- DPT transfer (crypto)
Regulatory Consideration
MAS will assess:
- AML risks
- Travel Rule compliance
- Jurisdictional exposure
Key Insight
Cross-border activity significantly increases regulatory scrutiny.
4. Merchant Acquisition Services
What It Covers
- Enabling merchants to accept payments
- Processing customer payments
How It Interacts With DPT Activities
Crypto platforms may:
- Enable merchants to accept crypto
- Convert crypto into fiat
- Provide payment gateways
Example
- Merchant accepts Bitcoin
- Platform converts to SGD
- Funds are settled to merchant
This Involves
- DPT service (crypto acceptance)
- Merchant acquisition (payment processing)
Regulatory Complexity
MAS will assess:
- Settlement mechanisms
- Risk exposure
- Consumer protection
Key Insight
Merchant services can turn a crypto platform into a full payment ecosystem.
5. E-Money Issuance Services
What It Covers
- Issuing stored digital value
- Maintaining balances for users
How It Interacts With DPT Activities
This becomes relevant when:
- Platforms create stored fiat value
- Users hold balances before trading
Example
- User deposits SGD
- Platform converts into stored value
- Used for crypto transactions
Regulatory Overlap
MAS distinguishes between:
- E-money (fiat-based)
- DPT (crypto-based)
Key Insight
Misclassifying e-money and crypto can create regulatory issues.
6. Digital Payment Token (DPT) Services
This is the core crypto activity.
What It Covers
- Buying and selling crypto
- Operating exchanges
- Facilitating trades
- Transferring tokens
Examples
- Spot trading platforms
- Brokerage services
- Crypto transfers
Key Requirement
DPT services must comply with:
- PSN02 (AML/CFT)
- Travel Rule
- Risk management obligations
Key Insight
DPT services are the centre—but not the entirety—of your licence.
7. Money-Changing Services
What It Covers
- Buying and selling foreign currency
Relevance to Crypto
Indirect but important.
Example
- User converts USD to SGD
- Uses SGD to buy crypto
Why It Matters
Because fiat conversion often precedes crypto activity.
Key Insight
Fiat conversion is often the entry point into crypto systems.
How These Activities Work Together (The Real Picture)
In practice, a crypto exchange may combine:
- Account issuance
- Domestic transfers
- Cross-border transfers
- Merchant services
- DPT services
Example Flow
A user:
- Deposits SGD → Account issuance
- Funds move internally → Domestic transfer
- Buys crypto → DPT service
- Sends crypto abroad → Cross-border interaction
What MAS Sees
Not separate services—but:
An integrated financial system.
Key Insight
The more services you combine, the more complex your regulatory obligations become.
In Part 2, we will go deeper into:
- How to structure these activities correctly under SPI vs MPI
- Common mistakes when combining DPT and non-DPT services
- Strategic licensing models used by crypto exchanges
- How MAS evaluates multi-activity platforms
- Practical structuring strategies to avoid regulatory delays.
PART 2:
In Part 1, we established a critical foundation:
- There is no standalone “crypto licence” in Singapore
- The Payment Services Act (PSA) regulates multiple payment services—not just DPT
- Crypto businesses often operate across several regulated activities simultaneously
- The interaction between these activities is where complexity—and regulatory risk—emerges
Now in Part 2, we go deeper into what actually matters for founders, operators, and investors:
How to structure these activities under SPI vs MPI licences, how MAS evaluates multi-activity crypto businesses, and how to avoid costly mistakes when combining fiat and DPT services.
This is where licensing becomes strategic.
The First Principle: MAS Evaluates Your Business as One Integrated System
One of the biggest misconceptions in structuring a crypto exchange or platform in Singapore is the idea that each activity can be treated independently.
For example, founders often think:
- “Our crypto trading is separate from fiat deposits”
- “Our wallet function is separate from our exchange”
- “Our payment gateway is a different product”
From a business perspective, this may make sense.
From a regulatory perspective, it does not.
MAS View
MAS looks at your business as:
A single, integrated financial system where all activities interact.
This means:
- Risks are assessed holistically
- Controls must be applied across the entire flow
- Responsibilities cannot be fragmented artificially
Key Insight
MAS is not licensing individual features.
It is licensing your entire operating model.
How SPI vs MPI Impacts Multi-Activity Businesses
In Part 1, we clarified that both SPI and MPI licences can cover the same categories of payment services.
However, when you combine multiple services—especially DPT with fiat activities—the difference between SPI and MPI becomes more significant.
SPI (Standard Payment Institution)
SPI is suitable when:
- Your transaction volumes remain below prescribed thresholds
- Your operations are relatively contained
- Your business model is not heavily dependent on large-scale fund movement
Challenges with Multi-Activity Models Under SPI
When combining:
- DPT services
- Fiat accounts
- Transfers
- Merchant services
You may quickly:
- Exceed transaction limits
- Increase operational complexity
- Trigger higher regulatory scrutiny
MPI (Major Payment Institution)
MPI is more suitable when:
- You are building a scalable exchange
- You expect significant transaction volumes
- You combine multiple payment services
Advantages of MPI for Crypto Businesses
- No transaction limits
- Greater flexibility
- Better alignment with growth
Key Insight
The more services you combine, the more likely MPI becomes the appropriate licence.
How DPT Activities Interact with Each Payment Service (Deeper Analysis)
Let’s now go beyond definitions and examine how these services interact in real-world crypto business models.
1. DPT + Account Issuance (The Core Exchange Model)
This is the most common structure.
How It Works
- Users hold fiat balances in accounts
- Funds are stored before trading
- Crypto balances are reflected post-trade
Regulatory Implications
MAS will assess:
- Safeguarding of customer funds
- Segregation of accounts
- Custody arrangements
Risk Area
Blurring between:
- Fiat accounts (regulated under PSA)
- Crypto custody (regulated under DPT scope)
Key Insight
The transition between fiat and crypto is one of the highest-risk points in your system.
2. DPT + Cross-Border Transfers (Global Crypto Movement)
Crypto inherently enables cross-border value transfer.
How It Works
- Users deposit funds locally
- Convert to crypto
- Transfer internationally
Regulatory Focus
MAS will examine:
- Travel Rule compliance
- AML monitoring
- Jurisdictional risk exposure
Challenge
Crypto simplifies cross-border movement—but increases:
Regulatory complexity and scrutiny.
Key Insight
Cross-border + crypto = highest AML risk category under MAS.
3. DPT + Merchant Acquisition (Crypto Payments)
This is where crypto meets real-world commerce.
How It Works
- Merchants accept crypto
- Platform converts to fiat
- Settlement is made to merchant
Regulatory Complexity
You are now combining:
- Payment processing
- Crypto conversion
- Settlement infrastructure
MAS Will Assess
- Consumer protection
- Pricing transparency
- Settlement risk
Key Insight
Crypto payment gateways are not just DPT services—they are full payment ecosystems.
4. DPT + Domestic Transfers (Internal Movement)
Often overlooked, but critical.
How It Works
- Funds move within your platform
- Internal ledger updates occur
- Pre-trade and post-trade transfers happen
Why MAS Cares
Because internal movement can:
- Mask risk
- Obscure transaction trails
- Create monitoring gaps
Key Insight
Internal transfers are not “invisible” to MAS—they are part of your risk framework.
5. DPT + E-Money (Where Confusion Happens)
This is one of the most misunderstood areas.
Difference
- E-money = fiat-based stored value
- DPT = crypto-based value
Where Problems Arise
When platforms:
- Treat stored fiat as interchangeable with crypto
- Blur distinctions in user balances
MAS Expectation
Clear separation between:
- Fiat systems
- Crypto systems
Key Insight
Misclassifying e-money and DPT can create serious compliance issues.
Common Mistakes When Combining PSA Activities with DPT
1. Treating Services as Separate When They Are Not
Many platforms:
- Build separate modules
- Assume separate regulation
Reality
MAS evaluates:
The full user journey—not individual components.
2. Underestimating Licensing Scope
Founders often:
- Apply only for DPT services
- Ignore other payment services
Result
- Incomplete licence scope
- Delays in application
- Requests for expansion
3. Overcomplicating Structure
Some businesses:
- Split functions across entities
- Use multiple jurisdictions
Result
- Reduced clarity
- Increased scrutiny
4. Ignoring Fund Flow Alignment
When:
- Activities do not match fund flows
- Documentation is inconsistent
Outcome
- Multiple MAS queries
- Delays in approval
Key Insight
Most licensing delays occur not because of complexity—but because of lack of clarity.
How MAS Evaluates Multi-Activity Crypto Platforms
When reviewing your application, MAS is asking:
1. Do we understand how this business operates?
- Are fund flows clear?
- Are activities properly defined?
2. Are risks identified and controlled?
- Where are AML risks?
- How are they managed?
3. Are responsibilities clearly assigned?
- Who controls funds?
- Who executes transactions?
4. Is the model scalable and sustainable?
- Can it handle growth?
- Can it manage risk at scale?
Key Insight
Approval depends on clarity, control, and consistency—not just compliance.
Strategic Structuring Approaches (What Works in Practice)
Approach 1: Unified Operating Entity
- One Singapore entity
- All activities integrated
- Clear fund flows
Advantages
- Simplicity
- Transparency
- Faster approval
Approach 2: Controlled Functional Separation
- Certain functions separated
- Clear responsibilities
- Strong alignment
Used For
- Custody vs trading
- Payment vs exchange
Requirement
Must remain:
Logically consistent and operationally clear
Approach 3: Global Structure with Singapore Hub
- Singapore as regulatory hub
- International operations supported
Challenge
Must comply with:
- PSA
- FSMA
Key Insight
The best structure is not the most complex—it is the most understandable.
How CRYPTOVERSE Can Help
Structuring multi-activity crypto businesses under the PSA requires more than understanding the law—it requires translating complex operations into a model that MAS can clearly assess.
CRYPTOVERSE helps clients:
- Identify all applicable PSA activities
- Design licensing strategies (SPI vs MPI)
- Align DPT and non-DPT services
- Build fund flows that reflect real operations
- Prepare applications that minimise delays
Our goal is to ensure that your business is not just compliant, but:
Strategically structured for approval and long-term scalability.
Final Thought
The PSA does not limit what your crypto business can do.
But it does define:
How clearly, responsibly, and transparently you must operate.
When combining:
- Fiat services
- Payment infrastructure
- Crypto activities
You are not just building a platform.
You are building:
A regulated financial system.
And in Singapore:
- Complexity is acceptable
- Innovation is encouraged
But only if:
Your structure makes sense—and your risks are controlled.
Because ultimately:
MAS does not approve complexity.
It approves clarity.
FAQs
1. What activities can an SPI licence holder offer under the PSA?
An SPI licence holder can offer domestic money transfers, cross-border transfers, merchant acquisition, and e-money issuance. Alongside DPT services, these activities are permitted if separately notified to MAS. Each service is regulated independently under the PSA, meaning compliance obligations stack — not merge — when multiple activities are conducted under one SPI licence.
2. What additional activities can an MPI licence holder conduct alongside DPT services?
An MPI licence holder can conduct account issuance, domestic and cross-border money transfers, merchant acquisition, e-money issuance, and money changing alongside DPT activities. Unlike SPI holders, MPI holders face higher capital and compliance thresholds per activity. Each additional service triggers its own MAS notification and regulatory obligation under the PSA framework.
3. Can an SPI licence holder offer DPT services in Singapore?
Yes. An SPI licence holder can offer DPT services alongside other permitted payment activities under the PSA, provided MAS approval or notification requirements are met for each activity. However, SPI holders face transaction and float limits that MPI holders do not, which effectively restricts the scale of DPT operations under an SPI licence.
4. What is the difference between SPI and MPI licence activities under the PSA?
SPI licences permit a limited set of lower-risk payment activities with transaction and float caps. MPI licences allow the full range of PSA-regulated activities without those caps. Both can include DPT services, but MPI holders can operate at institutional scale. The key difference is regulatory headroom — MPI is built for volume, SPI for smaller operators.
5. How do multiple PSA activities interact when held under one licence?
Each PSA activity — including DPT — carries its own compliance obligations. Holding multiple activities under one licence does not consolidate those obligations. AML/CFT requirements, MAS reporting, technology risk controls, and user protection rules apply separately per activity. Firms must ensure their compliance framework addresses every regulated service individually, not just their primary or dominant activity.