Malaysian Financial Watchdogs Issue Statement On Crypto Regulations

ICO News, News, Regulation | December 8, 2018 By:

The Securities Commission Malaysia (SC) and Bank Negara Malaysia (BNM), the country’s central bank, have issued a joint statement to provide clarity on the regulation of cryptocurrencies in the country.

The SC and the central bank said that regulations are currently being put in place to bring digital assets within the remit of securities laws to promote fair and orderly trading and ensure investor protection. According to the statement, initial coin offering (ICO) tokens and the trading of cryptocurrencies at domestic crypto exchanges will be regulated by the SC.

“ICO issuers and digital asset exchanges which are involved in the issuance or dealing of digital assets with a payment function will need to comply with relevant BNM laws and regulations relating to payments and currency matters,” the statement said. “In addition, ICO issuers and digital asset exchanges are subject to SC’s Guidelines on Prevention of Money Laundering and Terrorism Financing.”

In order to implement the regulatory framework on crypto assets, the regulators said they will enter into coordination arrangements to ensure compliance with laws and regulations under the purview of both financial watchdogs.

The SC and the central bank also reiterated that digital assets are not legal tender in the country and cautioned investors to carefully evaluate the risks associated with dealings in digital assets.

The statement came after Lim Guan Eng, the country’s minister of finance, announced late last month that official regulations for digital asset, cryptocurrency exchanges as well as ICOs will be enforced by Q1 2019. At the time, he explained that any parties interested in developing crypto exchanges or conducting ICOs must work within the framework set by the SC and Bank Negara Malaysia, which will be supervised by the Finance Ministry.