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 arrangement to recognize digital currencies and electronic tokens as securities will come into force on Jan. 15, under the regulation of the Securities Commission Malaysia [SC].
The order is called”the Capital Markets and Services (Prescription of Securities) (Digital Currency and Digital Token) Order 2019.” The commission must comply with securities laws and also approves cryptocurrencies, ICOs and their associated activities, the minister explained.
After Lim’s announcement, 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 related activities, will require authorisation from the SC and compliance with applicable securities laws and regulations,” elaborating:
Criteria will be among others, established by the guidelines for determining properness and fit of exchange operators and issuers, disclosure standards and best practices in trading rules price discovery and customer asset protection. Those dealing in digital assets will be asked to put in place anti-money laundering and counter-terrorism financing (AML / CFT) rules, cyber security and business continuity measures and bitcoin casino best slots.
Furthermore, the commission said 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 individual offering an ICO or operating a digital asset exchange without SC’s approval might 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 technology, as having the potential to bring about innovation in both old and new sectors,” Lim further clarified, elaborating:
Specifically, we believe digital assets have a role to play as an asset class for investors, and an alternate fundraising route for entrepreneurs and new businesses.
Meanwhile, Bank Negara Malaysia has said that cryptocurrencies are not legal tender in its own countrymBit scam The bank has advised the public to thoroughly assess the risks.
Bank Negara Malaysia has released a list of organizations that have announced themselves as cryptocurrency exchanges or service providers, but emphasized that it has neither licensed nor authorized these companies. Among companies on the list are Belfrics Malaysia, Upbit Malaysia, Bitpoint Malaysia, Bit Trade Enterprise, Bong Technology, Bxm, Luno Malaysia, Openbit, Udax International, Bit Malay, and Xbit Asia.
What do you think of Malaysia beginning to govern cryptocurrencies and ICOs? Let us know in the comments section below.
Pictures courtesy of Shutterstock, the Malaysian authorities, and Reuters.
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