Guide on the Tokenisation of Capital Market Products

On 14 November 2025, the Monetary Authority of Singapore (“MAS”) issued its Guide on the Tokenisation of Capital Market Products (the “Guide”), as an update to its previous Guide on Digital Token Offerings (“DTO Guide”).

The guide aims to support the development of a responsible digital asset ecosystem in Singapore by clarifying the application of securities law and related legislation to (i) issuances, offerings, and (ii) activities involving tokenised CMP. 

In this client update, we have summarised the key findings of the Tokenised CMPs Guide below. 

1. When is a Digital Token a Capital Market Product? 

Following the Guide, MAS has clarified its means of assessing whether tokenised CMPs will be subject to similar regulations as non-tokenised CMPs under the Securities and Futures Act 2001 (“SFA”). This is through the principle of “same activity, same risk, same regulatory outcome” where focus is on the economic substance of the digital token offered rather than the form of technology that created it. A holistic assessment of the token would thus be taken giving consideration to its characteristics, intent and structure, as well as the bundle of rights attaching to or deriving from the token. 

For reference, Appendix 1 of the Guide has illustrated a number of case studies where a digital token is likely or unlikely to be a CMP subject to regulation under the SFA. For assistance in determining whether a token falls within the definition of a CMP under the SFA, MAS has encouraged that token issuers seek professional advice from qualified legal practitioners. In this regard, please feel free to reach out to our team at Clyde and Co for assistance. 

2. Requirements of Securities Law on Issuances and Offerings of Tokenised CMPs in Singapore

a) SFA requirements 

Offerings of tokenised CMPs (such as securities, securities-based derivatives contracts, or units in a Collective Investment Scheme (“CIS”)) are subject to the same requirements under Part 13 of the SFA as their non-tokenised counterparts. This includes the requirement that the offer must be made in or accompanied by a prospectus prepared in accordance with the SAF and registered with MAS.

For tokenised CMP offerings of units in a CIS, the CIS is subject to further authorisation or recognition requirements, as well as compliance with investment restrictions and business conduct requirements under various guides, schemes and codes. 

However, an offer for tokenised CMPs may be exempt from the above requirements where the offer, subject to certain conditions, is: 

(i) A small personal offer not exceeding S$5 million within any 12-month period; 

(ii) A private placement offer made to no more than 50 persons within any 12-month period;

(iii) Made to institutional investors only; or 

(iv) Made to accredited investors. 

b) Disclosures in the Prospectus for Tokenised CMPs Offers 

Pursuant to section 243 of the SFA, the prospectus for an offer of tokenised CMPs should include information related specifically to both the characteristics of and risks arising from the tokenised nature of the CMP. This is especially given the use of unique technologies such as distributed ledger technology (“DLT”) and operating environments of the tokens. 

A non-exhaustive illustration of information that may be material for disclosure is as follows: 

c) Distribution safeguards for offerings of tokenised CMPs

Tokenised CMPs are subject to the same complex products framework as non-tokenised CMPs. The determination of whether a tokenised CMP is complex or non-complex is based on its product-specific characteristics, not its digital form. Complex tokenised products must be sold with enhanced distribution safeguards, such as assessing a customer's investment knowledge and experience. 

3. Requirements of Relevant Legislation on Activities Undertaken in Relation to Tokenised CMPs

a) Licensing Requirements under the SFA and the FAA

In relation to tokenised CMPs, the manner in which such activities are carried out may entail obtaining the relevant license under the SFA and/or the Financial Advisers Act 2001 (“FAA”). 

Some examples of activities by intermediaries and service providers that would require the relevant license are as follows: 

b) Application of Anti-Money Laundering and Countering the Financing of Terrorism Laws

Pursuant to the relevant MAS Notices on anti-money laundering and countering the financing of terrorism (“AML/CFT”), certain persons (as defined in said Notices) are subject to the requirements of the laws on AML/CFT as well as requirements in other regulations such as the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act 1992 (“CDSA”), and the Terrorism (Suppression of Financing) Act 2002 (“TSOFA”) and various regulations giving effect to United Nations Security Council Resolutions (“UN Regulations”). 

4. Extra-Territoriality of Securities Law 

The requirements of the SFA may apply extra-territorially if an issuance, offering, or regulated activity is done partly in Singapore and partly outside Singapore, or entirely outside Singapore but has a substantial and reasonably foreseeable effect in Singapore. Similarly, the FAA applies extra-territorially if a person outside Singapore tries to induce the public in Singapore to use their financial advisory services.

5. Application of Sandbox Criteria on Activities Regulated by MAS in Relation to Tokenised CMPs

Firms applying technology in innovative ways for activities regulated under the SFA or FAA may apply for the regulatory sandbox. Before applying, MAS expects firms to conduct due diligence, including testing in a laboratory environment and understanding all legal requirements. If approved, MAS provides temporary support by relaxing specific regulatory requirements. However, the offering or issuance of tokenised CMPs generally falls outside the scope of the sandbox program.

Implications 

The revised Guide makes clear the regulations surrounding the tokenisation of CMPs, signalling MAS’ stance on clear investor protection and regulation compliance. Issuer, offerors, trading platforms and financial advisors on tokens should clarify their obligations towards activities or offerings of CMP tokens to remain in line with the regulatory stance. 

In the Guide, MAS also emphasised the importance of offerors of digital token to seek independent legal advice in assessing whether the proposed digital token would fall within the definition of a CMP under the SFA, subjecting it to the various obligations under it. 

How we can help

With expertise in digital trade and technologies, Clyde and Co is able to assist in evaluating whether proposed digital tokens would be subject to the regulations of the SFA, the obligations arising therein and various other requirements arising from activities surrounding tokenised CMPs. Our team has extensive experience advising on digital technologies (including digital tokens and trading platforms), governance and policy development as well as regulatory compliance in Asia-Pacific. 

To find out more about this latest guideline development and what it may mean for you, please feel free to reach out to the authors below.