Hex Trust will begin offering regulated custody services in Singapore

Crypto custodian Hex Trust has received in-principle approval from the Monetary Authority of Singapore (MAS) to obtain a Major Payment Institution (MPI) license. This approval paves the way for the company to provide regulated digital payment token (DPT) services. The Monetary Authority of Singapore acts as a central bank and financial regulator, which makes its approval particularly significant for the further development of Hex Trust.

The MPI licensing regime was introduced under the Payment Services Act 2019 and updated in April 2024. These updates include an expansion into custodial services for DPT, highlighting the growing focus on regulated services in the digital asset space. Obtaining an MPI license from MAS represents an important step for Hex Trust to expand its operations and meet regulatory requirements.

Co-founder and CEO of Hex Trust, Alessio Quaglini, said that the process of obtaining an MPI license began in 2020. According to him, despite the significant cost and effort, this acquisition is of strategic importance for the company. Hex Trust is targeting licenses in key jurisdictions around the world, demonstrating their commitment to expansion and high regulatory standards.

Last November, Hex Trust already received an extended license in Dubai, which allows the company to offer comprehensive services for working with virtual assets, including broker-dealer functions and staking. In May 2024, Hex Trust also launched its own stablecoin USDX on Flare's layer-one (L1) blockchain, highlighting its proactive stance in innovation and expanding its service portfolio.

Alessio Quaglini noted that the space for unregulated crypto companies to operate is rapidly narrowing. In his opinion, obtaining a license opens up new opportunities for market players, and companies in the near future will be forced to make a choice between full compliance with regulatory requirements and working outside the regulated environment:

“Companies will need to make a decision: either be in the white zone, obtaining all the necessary licenses and running a fully regulated business, or remain in the unregulated part of the market,” Quaglini said.

Previously, other significant players in the cryptocurrency market received an MPI license from MAS, such as the developer of the Ripple payment protocol and the XRP token, the American crypto exchange Coinbase (NASDAQ:COIN), the blockchain explorer and crypto wallet service Blockchain_com, as well as the Korean crypto exchange Upbit. These examples confirm the growing importance of regulation in the crypto industry and the need to obtain licenses to successfully operate in the international arena.

As such, obtaining an MPI license from MAS represents an important step for Hex Trust in strengthening its market position and expanding its capabilities to provide regulated custody services in Singapore.