Malaysia Set To Enact Crypto And ICO Regulations In Q1 2019
Malaysia is set to enact regulations that would see the country’s regulator provide more oversight on the cryptocurrency and initial coin offerings (ICO) industry beginning Q1 2019.
That is according to Malaysia’s finance minister Lim Guan Eng.
Exchange and ICO regulation coming to Malaysia
The government official was quoted in local media outlet The Star on Wednesday, November 28, 2018, as saying that the Malaysian Securities Commission (SC) had given him an update on when the new rules would be enacted.
According to The Star, the new rules are part of the regulatory body’s wide-ranging efforts that are aimed at availing local firms and startups with “alternative fundraising avenues” as well as facilitate entry into the crypto sector that is viewed as “new investment asset classes.”
Speaking at the Fintech Conference 2018, which the Malaysian SC organized, the finance minister acknowledged that there are those that continue to be “skeptical” of the crypto industry.
However, he added that the industry needs appropriate regulations whose enforcement will “safeguard the interest of investors.”
Lim also took the time to reiterate his earlier statement, which called on all parties interested in the sector to consult with and work within limits set in a framework jointly developed by Bank Negara (Malaysia’s central bank), the Securities Commission, and Ministry of Finance (MOF) officials.
The new timeframe puts the regulations at the beginning of 2019, but that means it’s the first time the country has put out a date concerning crypto and ICO regulations.
At the end of 2017, Malaysia’s central bank promised to have cryptocurrency regulations ready at the beginning of 2018.
A delay has seen the country adopt a gradual approach to regulating the local cryptocurrency industry, which now appears to have a new timeframe of Q1 2019.
Central Bank of Malaysia to regulate crypto implementation
For much of this year, authorities have required that crypto industry players defer to guidelines issued by the central bank, with the finance minister stating on Monday that the government had an “open mind” about crypto.
He, however, had warned those companies or firms that might try to do things outside of the existing laws. Lim, in a response to a parliamentary question quoted in the New Straits Times, said that:
“I advise all parties wishing to introduce Bitcoin (style) cryptocurrency to refer first to Bank Negara Malaysia as it is the authority that will issue the decision on financial mechanism […]
It is not that we wish to obstruct (cryptocurrency) as we are keeping an open-mind. But it is still subject to existing laws.”
Earlier this November, a Malaysian member of parliament urged the government to consider having crypto regulations in place first before moving ahead with plans for a state-backed cryptocurrency.
Malaysia’s move comes at a time some of its Asian neighbors have given signals towards similar developments. In Japan, the Financial Services Agency (FSA) tightened requirements on crypto exchanges following the Coincheck hack in January, doing so to protect consumers.
In the Philippines, the Cagayan Economic Zone Authority (CEZA) recently released regulatory guidelines for cryptocurrency exchanges, twenty-five of which it granted licenses.
And in South Korea, where a ban on ICOs remains in place, the government had promised to look into the ICO question in November.
Disclaimer: This is not investment advice. Cryptocurrencies are highly volatile assets and are very risky investments. Do your research and consult an investment professional before investing. Never invest more than you can afford to lose. Never borrow money to invest in cryptocurrencies.