As the world is increasingly embracing Blockchain technologies, Malaysia recently took a significant step towards the inclusion of Crypto and digital assets into the economy.
A joint statement, released by the Security Commission (SC) and the central bank of Malaysia, Bank Negara Malaysia (BNM) on December 6th, disclosed a brief outline of their intentions to regulate digital assets and initial coin offerings (ICOs).
"In order to implement the regulatory framework on digital assets, the SC and BNM will enter into coordination arrangements to ensure compliance with laws and regulations under the purview of both regulators," said the media release.
According to the press release, the regulations have been placed to "bring digital assets within the remit of the securities laws to promote fair and orderly trading" and are to be applied to digital assets issued through ICOs as well as the trading of cryptocurrencies on domestic exchanges, to "ensure investor protection." The ICO issuers and exchanges will be subject to the commission's 'Guidelines on Prevention of Money Laundering and Terrorism Financing.' Thus, all parties wishing to issue a new asset could only do so with BNM's blessing. The press release concludes with a disclaimer from the BNM stating that "digital assets are not legal tender in Malaysia," encouraging consumers to perform due diligence before engaging with cryptocurrencies. "…the SC and BNM will enter into coordination arrangements to ensure compliance with laws and regulations under the purview of both regulators," it says towards the end while describing how these policies would be implemented in writing.
Among those eyeing the developments is a local initiative dubbed "Hope Coin," the creators of which may have to wait for the process to complete before launching.
This comes a little over a week since Malaysia's finance minister, Lim Guan Eng, stated that cryptocurrency regulations, aimed at safeguarding investor interests, will be enforced in the first quarter of next year. Malaysia has been slowly enacting a formalized stance on cryptocurrency activities this year. In September it initiated the process of a collaboration of it's three big industries with Blockchain technology, namely Islamic banking, palm oil, and its energy sector.
Other South East Asian countries are responding with similar pace as far as Blockchain is concerned. The Philippines will soon establish regulations regarding Blockchain and cryptocurrencies. Others like Singapore are adopting Blockchain technologies with similar fervor as South Korea, holding a significant dominance over the sector.
Associations like the European Union and the G20 are also increasingly including Blockchain and digital currencies in their financial ecosystems.
As we can see, this "fad" is not going anywhere soon.