Federal Territories Umno Youth information chief Wan Agyl Hassan, who is pushing for policies on cryptocurrency and blockchain, said the absence of “robust and dynamic” regulations meant fewer opportunities for Malaysians.
Last December, deputy minister in the Prime Minister’s Department Eddin Syazlee Shith said the government had no plans to regulate cryptocurrency because of its decentralised nature.
The Securities Commission (SC) classifies cryptocurrency as a form of security and has approved only four trading platforms for its purchase and sale – Luno, MX Global, Sinegy, and Tokenize.
The SC does not recognise cryptocurrency as legal tender or as a payment method accepted by Bank Negara.
But Wan Agyl said it was the decentralised nature of cryptocurrency technology that made it attractive to investors.
“The fact that not one single party can dictate how cryptocurrency is governed naturally means that it is more attractive for today’s investors to put their trust in,” he told FMT.
Cryptocurrency is increasingly becoming an alternative form of investment to stocks and shares, with reports finding that US$30 billion was invested in cryptocurrencies globally last year.
Wan Agyl cited Thailand as an example of a country that recognises cryptocurrency’s emergence. He referred to a recent Thai announcement that the country was developing its own cryptocurrency for tourists to use in paying for travel expenses.
He said many Malaysians held a lot of money in cryptocurrency but were unable to cash out because of current limitations.
“There is a long waiting period to withdraw money held in cryptocurrency as well as a limit on the amount that can be withdrawn. For example, the limit of Bitcoin transactions is RM5,000 per day.”
He said the government should regulate cryptocurrency so that people could use it to buy assets and pay for services.
Referring to fears that cryptocurrency would be used for money laundering, Wan Agyl said it was more transparent and less susceptible to manipulation than physical banknotes.
“Essentially, cryptocurrencies are based on blockchain technology, meaning that every transaction is recorded in a public ledger that is accessible to anyone and cannot be changed,” he said, adding this meant it was riskier to launder money using cryptocurrency than bank notes.
“Still, there is a need for regulation, monitoring and surveillance for crypto transactions because the world is moving in this direction,” he said.
He urged the government to engage with industry players and innovators on how best to apply the technology.