Committee: EcoFin
Delegation: Malaysia
Topic: Cryptocurrency
Malaysia's relationship with cryptocurrency has evolved over the past decade.
The country's central bank initially took a cautious approach toward
cryptocurrencies. However, as digital assets gained global popularity, Malaysia
began to develop a regulatory framework to manage and oversee their use.
Cryptocurrency in Malaysia has boosted financial inclusion, spurred youth
investment, and driven fintech innovation. However, it challenges traditional
banking and raises concerns about scams. Crypto's rise is reshaping economic
strategies, impacting monetary policy, and sparking public debates on finance
and technology's future.
Malaysia's crypto policies focus on regulation and investor protection, led by the
Securities Commission and Bank Negara Malaysia. The government justifies
these policies by aiming to balance innovation with financial stability, prevent
fraud, and ensure compliance with anti-money laundering laws, fostering a
secure environment for digital asset growth.
One notable quote from Tan Sri Muhyiddin Yassin, Malaysia's former Prime
Minister, regarding cryptocurrency, reflects the government's cautious stance:
"While we recognize the potential of cryptocurrencies and blockchain, we must
ensure that they do not pose risks to financial stability or become tools for illicit
activities."
Historical reliance on prudent financial policies drives this approach. To sustain
stability and prevent misuse, Malaysia will continue balancing innovation with
strict oversight in its evolving crypto landscape.
The Malaysian government has enacted strict regulations on cryptocurrency
exchanges, requiring them to register with the Securities Commission Malaysia. It
also implemented anti-money laundering laws, introduced the Capital Markets
and Services (Digital Currency and Digital Token) Order 2019, and regularly
issues public warnings about crypto-related risks.
Malaysia advocates for a balanced approach to address crypto issues:
implementing robust regulatory frameworks for transparency and investor
protection, enhancing anti-money laundering measures, and promoting financial
literacy. The goal is to foster innovation while safeguarding financial stability and
preventing misuse of digital assets.
Malaysia aims to ensure committee resolutions on cryptocurrency emphasize
rigorous regulatory standards, enhance global cooperation on anti-money
laundering and anti-terrorism financing, and promote balanced innovation. The
focus is on creating frameworks that protect investors while fostering the
development of secure and transparent digital asset markets.
Malaysia’s crypto stance is influenced by global trends; stringent regulations in
major economies prompt it to adopt similar measures for consistency and
security. Conversely, more lenient approaches elsewhere may lead Malaysia to
balance innovation with caution, ensuring it remains competitive while
safeguarding financial stability and compliance.
Cryptocurrencies - Malaysia | Statista Market Forecast, www.statista.com/outlook/fmo/digitalassets/cryptocurrencies/malaysia.
Sukumaran, Shangeetha, et al. “Cryptocurrency as an Investment: The Malaysian Context.” MDPI,
Multidisciplinary Digital Publishing Institute, 14 Apr. 2022, www.mdpi.com/2227-9091/10/4/86.
Patel, Kishan. “Is Malaysia the next Major Crypto Market?” World Blockchain Summit, 1 July 2024,
worldblockchainsummit.com/is-malaysia-the-next-major-crypto-market/.