Malaysian Ministry to Petition Government to Regulate Cryptos

UTC by John K. Kumi · 3 min read
Malaysian Ministry to Petition Government to Regulate Cryptos
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Deputy minister of Communications and Multimedia disclosed that the ministry is exploring possibilities and measures to safely improve the participation of young people in the industry. 

The popularity of crypto has brought a lot of headaches to regulators across the globe as their expected decisions are stuck between the adoption among the youth and the risk involved as a decentralized asset. One country that has gone back and forth on this is Malaysia. Early this month, Malaysian finance minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz objected to the popular view that cryptos should be legalized. According to him, cryptos like Bitcoin and Ethereum do not meet the universal characteristics of money, and so exist as illegal in the country.

“In general, digital assets are not a good store of value and a medium of exchange. This is because digital assets are vulnerable to volatile price fluctuations due to speculative investments, the risk of theft due to cyber threats and lack of scalability,” he said.

However, the Malaysian Ministry of Communications and Multimedia (KKMM) has in a recent statement announced its support for crypto adoption in the country. According to the deputy minister of Communication and Multimedia Datuk Zahidi Zainul Abidin, some use cases of cryptos and Non-Fungible Tokens (NFTs) are too good to ignore, hence the need to consider its legalization. Research has established that cryptos are more popular among the younger generation. Zahidi, therefore, believes that legalization would be an important support for young people. In addition, he disclosed that the ministry is exploring possibilities and measures to safely improve the participation of young people in the industry.

“We hope the government can try to legalize this matter so that we can expand the participation of young people in cryptocurrencies and help them in terms of energy consumption and so on, ” he said.

He also stated that the ministry has limited power to make this happen as the decision to legalize or regulate cryptos is within the jurisdiction of the financial regulators like the securities commission Malaysia and the central bank. Regardless, the ministry will follow up on this proposal as the crypto industry exists as a “business and financial program of the future” for the youth. Another source has also cited that the deputy minister’s proposal goes beyond crypto regulations. According to them, he also wants to push crypto to be a legal tender in the country.

Malaysia has recently sought to capitalize on the benefits of crypto to its financial sector by exploring the possibility of introducing a digital currency. According to Bank Negara Malaysia, the decision has not yet been made, but the country will not be left behind.

“While a decision has not been made to issue CBDC, we have focused our research on CBDC via proof-of-concept and experimentation to enhance our technical and policy capabilities, should the need to issue CBDC arise in the future, ” said Bank Negara.

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John K. Kumi
Author John K. Kumi

Excellent John K. Kumi is a cryptocurrency and fintech enthusiast, operations manager of a fintech platform, writer, researcher, and a huge fan of creative writing. With an Economics background, he finds much interest in the invisible factors that causes price change in anything measured with valuation. He has been in the crypto/blockchain space in the last five (5) years. He mostly watches football highlights and movies in his free time.

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