KUALA LUMPUR (May 20): The Securities Commission Malaysia (SC) has unveiled sweeping enhancements to its Guidelines on Recognized Markets, aimed at strengthening oversight of digital asset exchanges (DAXs) while accelerating the growth of the country’s regulated digital asset ecosystem.
In a statement on Wednesday, the regulator said the revised framework, which takes effect on May 20, 2026, is designed to improve the competitiveness of licensed DAX operators, enhance investor protection, and reinforce operational resilience amid rising institutional participation in digital assets.
Under the updated guidelines, regulated DAX platforms will benefit from a streamlined approval process intended to speed up product launches. In return, operators will face stricter accountability standards, tighter governance requirements, and stronger safeguards for client assets.
The SC is also raising financial stability, shareholding, and management competency requirements for DAX operators to ensure greater resilience within the sector.
In a further move to protect investors, all DAX operators will become members of the Financial Markets Ombudsman Service beginning in 2026, providing investors with access to a formal dispute resolution mechanism.
At the same time, the regulator is intensifying enforcement against unlicensed digital asset activities. The SC revealed it has taken administrative action against four digital asset exchanges operating without registration. It has also collaborated with technology firms, including Google, to restrict unregistered DAX operators from advertising their services to Malaysians through social media platforms and online channels from April 14, 2026.
SC chairman Datuk Mohammad Faiz Azmi said the digital asset industry must evolve alongside the broader capital market ecosystem.
“Our enhanced guideline demands resilient and credible partners within Malaysia’s financial market ecosystem. As the market grows more inclusive and innovative, it must be balanced with the highest standards of governance,” he said. The revisions were made after the SC reviewed global best practices, consulted industry stakeholders, and considered feedback from last year’s public consultation.
Malaysia’s regulated digital asset market continued to expand in 2025, with total trading value on licensed DAX platforms reaching RM17.14 billion, a 23% increase from RM13.93 billion recorded in 2024.
The revised framework also supports the broader goals of the Capital Market Masterplan 2026-2030, which targets increasing Malaysia’s capital market size to between RM5.8 trillion and RM6.3 trillion by 2030.
Beyond DAX regulation, the SC is also moving to bridge traditional and alternative investment markets through new measures, including a practice note on digital asset broking services and updated exchange-traded fund (ETF) guidelines that will allow the offering of digital currency ETFs.
According to the regulator, these initiatives are expected to broaden investor access to digital assets while preserving the integrity and stability of Malaysia’s capital market.