Singapore’s cryptocurrency market has seen a notable increase in crypto payments, with merchant services receiving nearly US$1 billion in crypto during the second quarter of 2024.
Singapore's cryptocurrency market has seen a notable increase in crypto payments, with nearly US$1 billion being received by merchant services in Q2 2024.
This surge reflects the growing adoption of digital assets as a payment method across various industries, including services offered by local startups like dtcpay and the super-app Grab. Both companies have integrated cryptocurrencies such as Bitcoin, Ether, Singapore's XSGD stablecoin, and USDT into their payment options, allowing customers to use these assets for everyday transactions like e-wallet top-ups.
A key part of this growth is the rise of XSGD, the Singapore dollar-backed stablecoin issued by StraitsX. XSGD has become increasingly popular, particularly among retail users, with more than 75% of its transfers being in amounts of US$1 million or less. Nearly 25% of these transfers were under US$10,000, indicating robust retail adoption.
In contrast, stablecoins pegged to the U.S. dollar, such as USDT, are primarily being transferred in larger amounts, reflecting more institutional use.
These developments are supported by key regulatory moves. In August 2023, the Monetary Authority of Singapore (MAS) finalised its stablecoin regulatory framework, providing clear guidelines for issuers. StraitsX, for example, secured two MAS licenses to issue stablecoins and facilitate crypto payments.
Meanwhile, Paxos, a U.S.-based stablecoin issuer, also gained MAS approval to issue stablecoins in Singapore. This growing acceptance of stablecoins and other cryptocurrencies is further supported by MAS’s crypto custody and licensing requirements, implemented in April 2024.
In line with this growing interest in stablecoins, Singapore's largest bank, DBS, has been exploring the listing of stablecoins on its digital exchange. The bank saw its crypto trading volume triple in early 2024, driven by increasing institutional demand.
These regulatory measures, combined with increased crypto merchant adoption and exploration by major financial institutions like DBS, are positioning Singapore as a key hub for digital assets.
