The Finance Minister of Malaysia Lim Guan Eng has revealed that the country will start cryptocurrency regulation in the first quarter of 2019 to guide the activities of crypto exchanges and ICOs.
Speaking at the FinTech Conference 2018 organized by Malaysia Securities Commission on Wednesday, he revealed that the new regulations are parts of efforts by the Malaysian Securities Commission to spur the growth of alternative fundraising and investment in new asset classes in the country.
In his keynote address at the event, the Minister stated that the system jointly developed by Bank Negara Malaysia (the country’s central Bank) and the Securities Commission would serve as a comprehensive regulatory framework for all participants in the crypto industry. Lim stressed that the overriding factor behind the decision is to ensure consumer protection so as to reduce suspicion. He stated:
“While some parties might still be skeptical of this space, there can be no doubt that we need appropriate regulations to be put in place and enforced to safeguard the interest of investors. […] Both Bank Negara and the SC, in terms of formulating this framework will be under the auspices of the Finance Ministry. The Finance Ministry will lead the committee comprising of Bank Negara, the SC, and the MOF itself.”
According to him, the regulatory framework forms an important part of the Malaysian government’s efforts to catalyse the growth of alternative funding to accelerate private sector growth and reduce government fiscal burdens. The Malaysian authorities discovered an opportunity for economic growth in the crypto industry, believing that cryptocurrency-led fundraising such as ICOs will provide solutions to the overstretched and unwilling to lend domestic financial atmosphere. Through ICOs, innovation-led start-ups can raise funds for development purposes. In the words of Lim:
“Through this, we hope to be able achieve faster fund disbursements to support a broader range of deserving MSMEs, as well as provide greater transparency to how public funding are being utilised.”
This new development potentially comes as a significant boost to cryptocurrency adoption in Malaysia and other countries are expected to follow suit in due time.