The Minister of Federal Territories of Malaysia has categorically stated that the current laws for cryptocurrency in the country do not allocate ‘legal or illegal’ status to its use. This was despite efforts by the finance minister’s 2018 warning to crypto companies against issuing new tokens. He had stated that such activities can be indulged in only after the Central Bank of the country issued further clarification on their status.
Illegal or Legal?
Khalid Abul Samad, a Malaysian politician, is known to be a supporter of cryptocurrencies. He had campaigned for his political party – Pakatan Harapan- which is the ruling party to issue a token named Harapan to fund the campaign. However, the initiative has yet to be approved by the country’s central bank.
Samad claimed that despite being an appointed minister, his portfolio was limited to that of federal Territories and he was not a finance minister to further influence and pressure the government to take a stance quickly on the use of Decentralized Ledger Technology.
As with the current practices, all types of digital currencies, including bitcoin are not considered legal tender. At the same time, these coins are not banned, therefore allowing their use by those who are curious and committed to using it. Herein lays the biggest challenge for crypto users in Malaysia. The unregulated scheme of things allows an easy opportunity for those who set to commit crimes leaving crypto consumers cheated and unprotected.
The increase in incidents of such crime had led to the Finance Minister, Guan Eng, issue a warning to desist from issuing new coins. In order to ensure better consumer protection, he suggested that users should wait for Bank Negara, the central bank, to issue a protection framework. He had said that directives by the Bank would ensure that any of the cryptocurrency organizations would have to follow the prescribed rules, therefore, protecting them from further exploitation.
As the Finance Minister of the country, his public statements showing positive sentiment towards the use of cryptocurrencies was evident, by the very fact that they were never denied. In fact, the Minister has reiterated that his government clearly welcomed the use of these new and technology-enabled virtual currencies. There was further evidence of the government’s intent in ushering in the cryptocurrency age by the manner in which the Harapan coin was raised, but it prefers the needed regulation is well in its place before the government pushes ahead with the issue and fund-raising activities of the Harapan coin.