Singapore VCC insights

Tokenised Fund VCC: Who Owns the Shares When the Register Moves On-Chain

By VCC Editorial Team · Published 23 October 2026

Short answer: A Singapore VCC can issue shares that are recorded or represented on a distributed ledger, but the Variable Capital Companies Act 2018 still governs title, transfer and the register of members. MAS regulates the token as the capital markets product it represents. The constitution and offering documents must state which record is definitive.

This article is general information only and is not legal, tax or investment advice. For matters needing legal advice, we work with a panel of experienced Singapore law firms.

A tokenised fund VCC is a variable capital company whose shares are issued, recorded or transferred using tokens on a distributed ledger. This guide covers the legal mechanics a board must settle before launch: how the statutory register of members relates to a token ledger, where transfer restrictions come from, how classes and sub-funds map to tokens, and what MAS has and has not said. We checked every statutory reference and MAS publication against primary sources on 20 October 2026.

Can a Singapore VCC issue tokenised shares?

Yes. Nothing in the Variable Capital Companies Act 2018 prohibits a VCC from using a distributed ledger to issue or record its shares, and MAS treats the resulting token according to its economic substance. But the Act still decides who is a member, and the token on its own does not.

The starting point is the definition of “share” in section 2 of the Variable Capital Companies Act 2018: a share in a VCC is “a unit in a collective investment scheme that is part of the VCC”. A token that represents a VCC share is therefore, in MAS’s terms, a unit in a collective investment scheme (CIS). MAS’s Guide on the Tokenisation of Capital Markets Products makes the same point from the regulator’s side. Case study 6 concludes that a token representing pooled, professionally managed investments “will be a unit in a CIS under the Securities and Futures Act”. MAS says it adopts “a technology-neutral approach” and looks at the bundle of rights attached to the token.

Two consequences follow. First, the offer of the tokenised shares is regulated as an offer of CIS units under Part 13 of the Securities and Futures Act 2001. Second, the fund still needs a manager that qualifies under section 46 of the Act: a capital markets services licensee for fund management, a registered fund management company, a person mentioned in section 99(1)(a) to (d) of the Securities and Futures Act 2001, or a prescribed person. Tokenisation does not change who must be licensed.

Which record is definitive: the register of members or the token ledger?

Under the Act, the register of members kept under section 81 is the statutory record of membership. A token ledger can mirror it, feed it, or be designated as the place where the register is maintained, but the constitution and offering documents must say which record governs if the two ever disagree.

Section 2 defines “register of members” as the register “kept by a VCC under section 81” (see our note on the Act’s core dealing definitions). ACRA’s post-registration guide for VCCs, last updated 15 June 2026, lists the Register of Members (Shareholders) under section 81 as a register every VCC must set up and maintain.

MAS does not prescribe an answer, but the Guide lists as potentially material for disclosure how ownership is recorded, “whether such records are maintained on or off the DLT network”, when transfers are final and, where there is more than one record, “which records are definitive of legal ownership rights”. The Guide also expects disclosure of any right of the issuer or others “to amend or override records on the DLT network”. For a VCC, an override right is needed in practice to correct the register after a court order, a transmission or a sanctions freeze.

The Guardian Funds Framework of 4 November 2024 discusses on-chain share register archetypes, but it is an industry recommendation, not a MAS rule, and does not displace section 81.

Register model	Where legal title is recorded	What the board must document
Token mirrors an off-chain register	Section 81 register kept by the VCC or its transfer agent; tokens follow it	Reconciliation frequency, and that the off-chain register prevails on any mismatch
Register maintained on the ledger	The ledger, designated in the constitution as the form in which the section 81 register is kept	Admin keys to correct entries, export of a legible register on request, record-keeping and inspection under section 82
Token as a separate entitlement	A nominee or custodian is the registered member; token holders hold a contractual or beneficial interest	Nominee terms, look-through for AML, and how voting and redemption pass through

Whichever model is chosen, keep the reconciliation discipline described in our guide to reconciling a VCC register of members to transfer-agent data.

How do transfer restrictions work when shares move on-chain?

Statute and the constitution set the transfer restrictions, and the smart contract enforces them. If the code allows a transfer the law would refuse, the code is wrong.

Four provisions of the Act matter most:

• Section 34(1): shares are transferable “in the manner provided by the constitution”. The constitution should describe the token transfer mechanism.
• Section 40(3): despite anything in the constitution, a VCC “must not register a transfer of shares or debentures unless a proper instrument of transfer has been delivered”. Counsel must confirm that a signed on-chain transaction, with the platform terms, qualifies.
• Section 40(5): a VCC may refuse to register a transfer that would breach a minimum holding in the constitution or prospectus, or that “is inconsistent with any provision of the VCC’s constitution”. This supports coding eligibility checks into the token.
• Section 40(6): a VCC need not register a transfer, or give notice of refusal, where doing so “would result in a contravention of any law”, including foreign law.

Section 40(4) preserves the VCC’s power to register a person to whom shares pass “by operation of law”. Executors and trustees in bankruptcy will not hold the investor’s private keys, so the fund needs a process to re-assign tokens without the original wallet signing.

How do share classes and sub-funds map to tokens?

Each class of shares, and each sub-fund of an umbrella VCC, should normally be a separately identifiable token, so that NAV, fees and segregated liabilities stay traceable to the right holders.

Section 34(3) allows a VCC to issue more than one class of shares, subject to its constitution. Section 34(5) permits conversion between classes if the constitution provides for it. Section 19(1)(e) implies into every constitution that shares are issued, redeemed or repurchased “at a price equal to the proportion of the net asset value of the VCC represented by each share”, subject to fees and charges permitted by the constitution. A single fungible token spread across two classes with different fee loads would put that implied term at risk. For an umbrella VCC, ACRA requires a new sub-fund to be registered within seven days of its formation. For the choice between a new class and a new sub-fund, see our comparison of VCC share classes and sub-funds.

Section 34(2) states that “a shareholder has no interest in the property of a VCC”. A token holder owns a share, not a slice of the portfolio. And section 38(2)(a) relieves a VCC of the duty to issue share certificates where its constitution says certificates will not be issued and provides for “written confirmations of entry in the register of members”. Without a certificate, the prima facie evidence of title in section 39(1) is unavailable, so investors rely on the register entry.

What does MAS require for a tokenised fund VCC offering?

The same prospectus, exemption and distribution rules that apply to any VCC offer, plus disclosure about the technology. MAS says tokenised capital markets products “are essentially no different from non-tokenised CMPs in economic substance”.

Under paragraph 3.4 of the Guide, an offer may be exempt from the prospectus and CIS authorisation or recognition requirements if, among other routes, it is a small personal offer not exceeding S$5 million within any 12-month period, a private placement to no more than 50 persons within any 12-month period, an offer to institutional investors only, or an offer to accredited investors. Each route has conditions, including advertising restrictions.

The Guide’s disclosure illustrations cover the type of ledger, smart contract governance and audit, controls on minting, transferring, redeeming and burning tokens, and risks such as cyber attack, forks, private key loss and “the legal status of tokenised CMPs under property law”.

On custody, paragraph 4.6 says a person has “control” of a token if it can control access to it or execute transactions. That includes holding one of several keys, or a shard of a key, that can co-authorise a transaction. A custodian or administrator holding a recovery key may therefore be providing custodial services under the Securities and Futures Act 2001 and need to be licensed or exempt. Under paragraph 5.1, the Act can also apply extra-territorially under section 339.

What is settled and what is still unsettled?

The regulatory perimeter is largely settled. Whether a token itself carries legal title, and how property law treats it in insolvency or a priority dispute, is not.

1. Settled: a token representing a VCC share is a CIS unit for Securities and Futures Act 2001 purposes, and offer, licensing and AML rules apply as they do to non-tokenised units.
2. Settled: the VCC must keep a register of members under section 81, and transfer registration is governed by section 40.
3. Unsettled: whether an on-chain transfer is itself a “proper instrument of transfer” under section 40(3), or whether the platform terms must supply it. Get a Singapore legal opinion.
4. Unsettled: how a court would resolve a conflict between the ledger and an off-chain record. The Guide lists the legal status of tokenised products “under property law” as a risk to disclose.
5. Unsettled: MAS’s further work. On 9 October 2026 the MAS Managing Director said MAS is “reviewing other aspects of tokenisation that may require further legal clarification”.

Valuation adds its own operational risk. Where the fund holds digital assets, chain events such as forks can affect NAV before any token moves. See our note on resolving a digital-asset fork before VCC NAV.

How does AML work for a tokenised VCC under MAS Notice VCC-N01?

MAS Notice VCC-N01 applies in full. The VCC must appoint an eligible financial institution to carry out customer due diligence, and every wallet that can hold shares must be tied to a verified investor.

MAS describes the Notice as requiring VCCs to “identify and know their customers (including beneficial owners)”, conduct regular reviews, and monitor and report suspicious transactions. and maintain a register of beneficial owners. The latest amendment took effect on 1 July 2025. In a tokenised structure, the eligible financial institution’s onboarding must come before the wallet is whitelisted, and each secondary transfer to a new holder should be screened in the same way before the register is updated.

Where subscriptions or redemptions settle in a stablecoin, check MAS’s proposed stablecoin framework, discussed in our analysis of stablecoin regulation in Singapore. On 9 October 2026 MAS said it had consulted on legislative amendments to implement its Single-Currency Stablecoin framework; treat the framework as proposed until the amendments are enacted.

How is MAS supporting tokenised funds in 2025 and 2026?

Through industry frameworks and infrastructure rather than new fund legislation. The legal rules remain the Variable Capital Companies Act 2018 and the Securities and Futures Act 2001.

• 4 November 2024: MAS said Project Guardian had convened over 40 financial institutions, industry associations and policymakers across seven jurisdictions, with more than 15 industry trials in six currencies. It published the Guardian Funds Framework the same day.
• 12 November 2025: MAS announced an industry operational guide for tokenised funds that supplements the Guardian Funds Framework. BLOOM, for wholesale settlement in tokenised deposits and regulated stablecoins, had launched the previous month.
• 25 June 2026: MAS announced the Future of Finance Institute, focused initially on AI and tokenisation, with industry sandboxes and a Programmable Compliance Toolkit for tokenised assets.
• 9 October 2026: MAS said its next step is to settle tokenised MAS Bills with Singapore dollar wholesale central bank digital currency.

Infrastructure is maturing while the law stays technology-neutral, so documents should work under current law and leave room for later standards. Our sister firm Singapore Secretary Services supports the company secretarial side of register maintenance.

Frequently asked questions

Does a tokenised VCC still need a register of members?

Yes. Section 81 requires it and ACRA lists it as mandatory. The ledger may be how it is kept, but the VCC must be able to produce an accurate register and allow inspection under section 82.

Can the smart contract block a transfer to an unverified wallet?

Yes, if the constitution provides for it. Section 40(5) allows refusal where a transfer is inconsistent with the constitution or breaches a minimum holding, and section 40(6) removes any duty to register a transfer that would contravene any law.

Who can hold the private keys?

Investors, a custodian or another provider. Paragraph 4.6 of the Guide treats holding a key or key shard that can co-authorise a transaction as “control”, which may require a capital markets services licence for custodial services unless an exemption applies.

Has MAS issued rules specific to tokenised funds?

Not as legislation. The Guide explains how existing law applies, the Guardian Funds Framework sets industry recommendations, and MAS said on 9 October 2026 that further legal clarification is under review.

Sources

• Variable Capital Companies Act 2018, Singapore Statutes Online
• MAS, Guide on the Tokenisation of Capital Markets Products (last revised 14 November 2025)
• MAS, Guardian Funds Framework (4 November 2024)
• MAS Notice VCC-N01 (last revised 30 June 2025)
• ACRA, Post-registration guide for VCCs

Raffles Corporate Services helps fund managers and family offices structure tokenised share classes and sub-funds within a Singapore VCC, coordinating constitution drafting, register-keeping and AML onboarding with experienced Singapore law firms. We also support VCC incorporation, family office set-up and ongoing compliance. Email hello@rafflescorporateservices.com or Call/SMS/WhatsApp +65 8501 7133, or visit Raffles Corporate Services.

Last reviewed: 23 October 2026. The Editorial Team, Variable Capital Companies Act.