Singapore tests tokenized government bonds and prepares stablecoin legislation for 2026

The Monetary Authority of Singapore (MAS) is announcing a new phase of its digital asset strategy. Starting in 2026, the central bank will for the first time test tokenized MAS Bills as part of an official pilot programme.

In parallel, the authority is working on a new stablecoin law designed to regulate the market for private digital means of payment in the city-state’s economy. With this, MAS is expanding its existing tokenization initiative “Project Guardian” and confirms that the regulatory framework for stablecoins is already in preparation. Both steps aim to strengthen Singapore’s international position as a hub for regulated tokenization and digital market infrastructure.

Tokenized government bills: core element of the new pilot phase

According to MAS Managing Director Chia Der Jiun, Singapore will begin next year to provide MAS Bills – short-term government securities – in tokenized form for the interbank market. These bonds are among the safest and most liquid instruments in the Southeast Asian financial system and are traded daily in the billions. Through tokenization, trading, settlement, and collateral processes are expected to be accelerated and automated.

The authority emphasised, according to Reuters, that previous experiments tokenizing bank liabilities and securities had shown the technology to be market-ready, although still in need of a more robust infrastructure. The tokenized MAS Bills are therefore intended to serve as a real liquidity test to examine how interoperable networks function in institutional trading.

Wholesale CBDC and existing bank tests to be expanded

Singapore had already tested a wholesale CBDC used for settlements between DBS, OCBC and UOB. These experiments now flow into the new pilot programme. MAS confirmed that the upcoming tests will combine both tokenized government bills and tokenized bank liabilities to map a fully digital financial market chain – from liquidity management all the way to final settlement.

In parallel, MAS developed a new regulatory framework for stablecoins, which will come into force in 2026. The focus is on three requirements: full, high-quality reserve backing, clear redemption mechanisms, and mandatory licensing for issuers. Priority is given to single-currency stablecoins that are backed 1:1 by the Singapore dollar or highly liquid currencies such as the USD.

The authority warned that while the market for private stablecoins has grown, it poses significant risks to consumers and institutional users without clear rules. The new law aims to establish globally recognised standards – comparable to the European MiCA regime, but with a stronger banking orientation.