Business 15 January 2019

Dennis Wafula

Legal or illegal? Malaysia gov’t still undecided on cryptocurrency

The Malaysian government is still uncertain whether to make cryptocurrencies a legal entity or not. According to reports, cryptocurrencies are neither legal nor illegal in Malaysia.

While addressing the issue, the Minister of Federal Territories, Khalid Abdul Samad stated that the matter is still under consideration. He added:

“People have asked me if these (cryptocurrency and digital currency) currencies are legal or illegal. At the moment, the answer is neither legal nor illegal as the situation is still unclear.”

Samad also stated that he was involved in the launch of Harapan Coin (HRP)- a proposed political cryptocurrency. He added that since he is not the Minister of Finance, the matter on cryptocurrencies does not fall under his jurisdiction.

Samad confirmed the indecision when he was officiating a tea reception and school aid presentation for 100 orphans in Kuala Lumpur.

As it is, Malaysia is one of the few countries in South East Asia that are still undecided on digital currencies. The indecision has caused Malaysia’s financial position to lag. However, some individuals have made proposals to have the matter settled by authorities.

Reportedly, Samad has previously proposed to Bank Negara Malaysia and to Prime Mister Tun Dr Mahathir Mohamad to use Harapan Coin for government tractions.

 The Finance Minister, Lim Guan Eng, had warned organisations not to issue new tokens and wait for the national bank to give explicit requests on the issue. He stated:

“Don’t do it without Bank Negara’s guidelines or directive on the matter to avoid doing something wrong and against the law.”

Guan also stated that the government is not against cryptocurrencies but as long as they adhere to the set laws.

In November, a Member of Parliament has asked the government to implement regulations for activities within the crypto space. Last year in December, the Malaysian financial regulator and the central bank issued a jointed statement that confirmed they were in the process of setting up regulations for cryptocurrencies and Initial coin offerings (ICOs).

Like Malaysia, many countries have yet to make a stance on digital currencies. The current financial state of cryptocurrencies has not made it easier for authorities to make decisions of the matter.

Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins.

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