Malaysia's Crypto Scene Heats Up: New Rules to Speed Up Listings and Protect Investors

Securities Commission Drops Bombshell Consultation Paper

Hold onto your hats, crypto fans! Malaysia's Securities Commission just dropped a game-changing consultation paper that's set to shake up the digital asset world. They're planning a massive overhaul of their regulatory framework for digital asset exchanges (DAX), and it's all about speeding up token listings while beefing up investor protection.

This Monday, the SC unleashed their proposals, and they're not messing around. They want to let certain digital assets hit the DAX platforms without the SC's pre-approval, as long as they meet some strict criteria. But don't think it's a free-for-all—the SC's also cracking down on exchange operators with tougher governance and operational rules, like forcing them to keep client assets separate and raising the financial bar.

The SC's putting the word out to everyone in the industry—issuers, exchanges, banks, and lawyers—to give their two cents on these proposals. You've got from June 30 to August 11 to make your voice heard.

These proposed changes are the next step in the SC's mission to keep a tighter leash on the digital asset wild west and keep the market honest. It's all happening after the SC's been cracking down on unlicensed crypto exchanges that have been trying to sneak around without the regulator's Recognised Market Operator (RMO) stamp of approval, as required by the Capital Markets and Services Act 2007.

Just last December, the SC came down hard on Bybit and its CEO, telling them to pack up and stop all their operations and marketing in Malaysia for running an unlicensed digital asset platform. And in 2023, the SC gave Huobi Global the boot for the same reason—not registering as an RMO.

But it's not all about cracking down. The proposed DAX reforms are coming at a time when Malaysia's digital asset scene is absolutely exploding. Ever since the DAX framework was introduced in 2019, things have been on fire. In 2024, trading volumes hit a mind-blowing RM13.9 billion ($2.9 billion), more than double what they were the year before. The SC says institutional investors and traditional capital market players are jumping in with both feet, either directly or through funds.