Due to the conflict over cryptocurrency that has arisen in recent weeks, Chin Wei Min, Managing Director of the Securities Commission Malaysia, made clear certain positions it held yesterday with regard to digital assets.
One of the most frequently asked questions after the announcement last week : - Is it all securities?
Executive Director of the Securities Committee Malaysia : Chin Wei Min
The same cryptocurrency could be caught as securities on the basis of its use, for example Bitcoin. It falls under the jurisdiction of securities laws, if it is traded. If the same bitcoin is used for paying for a nasi-lemak packet then it is not caught in the prescription order and not taken into consideration as securities.
The recruitment is based on activity. So it's a security if it is traded. It is not and would require a Bank Negara license instead, if it is used as a payment.
Scenario 1:When are Digital Assets taken into Security?
In accordance with the prescription order set out in the Website of the Federal Gazette, when:
- Trading shall take place or at an establishment where offers are regularly made or accepted to sell, buy, or exchange digital currency
- A person expects a return in any form from digital currency trading, converting or redeeming or appreciation of digital currency values
- Is not issued or guaranteed by any government body or central banks as may be specified by the Commission
Digital tokens representing a person's right or interest in a specific arrangement where:
- In return for a consideration, the person receives a digital token
- The person's consideration or contribution and income or returns shall be pooled
- Any properties or assets or business activities are derived from the procurement, holding, managing or disposing of the revenue or returns from the arrangement
- A person expects a return in any form from the digital token 's trading, conversion or redemption or the value appreciation
- A person has no daily control over the property, assets or business management of the management
- The digital token is not issued or guaranteed by any government body or central banks as may be specified by the Commission
Their main aim is to protect regular investors in Malaysia in the drafting of these legislation. We will be waiting for rules on how they conduct themselves in a few weeks time if digital assets are prescribed as securities.
The post “SC Malaysia Clarified : A Crypto-Asset is only A Security if Used in Specific Ways“ appeared first on FintechNews
Posted from my blog with SteemPress : http://theblocksignal.com/2019/01/sc-malaysia-clarifies-a-crypto-asset-is-a-security-only-if-used-in-a-particular-manner/