KUALA LUMPUR (Jan 14): The Capital Markets and Services (Prescription of Securities) (Digital Currency and Digital Token) Order 2019 will come into force tomorrow (Jan 15) to allow the Securities Commission Malaysia (SC) to regulate digital assets as prescribed securities. 

Finance Minister Lim Guan Eng said today the offering of such instruments, comprising digital currencies and tokens, as well as its associated activities, will require authorisation from the SC and need to comply with the relevant securities laws and regulations. 

"The Ministry of Finance views digital assets, as well as its underlying blockchain technologies, as having the potential to bring about innovation in both old and new industries. In particular, we believe digital assets have a role to play as an alternative fundraising avenue for entrepreneurs and new businesses, and an alternate asset class for investors.

"In this regard, the SC will put in place the relevant regulatory requirements for the issuance of initial coin offerings (ICO) and the trading of digital assets at digital asset exchanges in Malaysia. This framework is expected to be launched by end-Q1 2019. Any person offering an ICO or operating a digital asset exchange without SC’s approval may be punished, on conviction, with imprisonment not exceeding 10 years and fine not exceeding RM10 million," Lim said in a statement.