Regulating as Securities
Malaysian Finance Minister Lim Guan Eng said on Monday that his country”will govern initial coin offerings (ICOs) and the trade of cryptocurrencies,” Reuters reported, adding:
An order to recognize digital currencies and digital tokens as securities will come into force on Jan. 15, under the regulation of the Securities Commission Malaysia [SC].
The order is known as”the Capital Markets and Services (Prescription of Securities) (Digital Currency and Digital Token) Order 2019.” The commission must comply with relevant securities laws and also approves ICOs cryptocurrencies and their activities, the minister explained.
After Lim’s statement, the Securities Commission Malaysia verified that it”will put in place guidelines to govern trading and offering of digital assets.” The regulator noted that”the offering of digital assets, as well as its associated activities, will require authorisation from the SC and compliance with relevant securities laws and regulations,” elaborating:
The guidelines will among others, establish criteria for determining healthy and properness of practices and exchange operators, disclosure standards and issuers in price discovery, trading principles and client asset protection. Those dealing in electronic assets will be required to put in place anti-money laundering and counter-terrorism financing (AML / CFT) principles, cyber security and business continuity measures and bitcoin casino best slots.
Furthermore, the commission stated that it”will enter into coordination arrangements” with the Bank Negara Malaysia, the country’s central bank, in order”to ensure compliance with laws and regulations under the purview of both regulators.” Additionally, the regulator revealed that”The relevant regulatory framework is expected to be launched by end-Q1 2019.”
Lim was quoted by The Star as saying,”Any person offering an ICO or operating a digital asset exchange without SC’s approval may be penalized, on conviction, with imprisonment not exceeding 10 years and fine not exceeding RM10mil [~$2.44 million].”
Malaysian Finance Minister Lim Guan Eng
Ministry of Finance Sees Potential
The finance ministry”views digital resources, as well as… inherent blockchain technologies, as having the potential to bring about innovation in both old and new sectors,” Lim further described, elaborating:
In particular, we consider digital assets have a role to play as an alternate asset class for investors, and an alternate fundraising avenue for entrepreneurs and new companies.
Meanwhile, the Bank Negara Malaysia has said that cryptocurrencies are not legal tender in its own countryTrueflip site The central bank has advised the public to assess the risks associated in dealing with them.
Bank Negara Malaysia has released a list of companies that have announced themselves as cryptocurrency exchanges or service providers, but emphasized that it has neither licensed nor authorized these businesses. Are Belfrics Malaysia, Xbit Asia, Bitpoint Malaysia, Bit Trade Enterprise, Bong Technology, Bxm, Luno Malaysia, Openbit, Udax International, Upbit Malaysia, and Bit Malay.
What do you think of Malaysia beginning to govern cryptocurrencies and ICOs? Tell us in the comments section below.
Images courtesy of Shutterstock, the Malaysian authorities, and Reuters.
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