The Securities Commission Malaysia (SC) has approved three companies to establish and operate digital asset exchange (DAX) in the country.
Dubbed as registered market operators (RMOs), the three operators are Luno Malaysia Sdn Bhd, SINEGY Technologies (M) Sdn Bhd, and Tokenize Technology (M) Sdn Bhd.
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The June 4 announcement specified that the RMOs would get up to nine months to fully comply with local regulatory rules.
Commenting on the approval, David Low, general manager of Southeast Asia at Luno, said: “We’ve been working closely with regulators and banks to complete the groundwork for the buying, selling and storing of cryptocurrencies and digital assets, which we believe are the future of money.”
“[The] regulation will ultimately bring clarity and protection to consumers, and will ensure that all cryptocurrency businesses have adequate standards in place to protect investors and their funds.”
Harsh laws against ICOs
In January, the SC introduced the Capital Markets and Services released (Prescription of Securities) (Digital Currency and Digital Token) Order 2019 followed by the issuance of the revised Guidelines on Recognized Markets, which made it mandatory for the crypto exchanges operating in the country to seek permission from the market regulator.
The laws regulating the token sales, however, came under heavy criticism as they were considered to be very strict as any person or entity launching unauthorized ICOs or participating in the exchange of digital goods would face up to 10 years imprisonment or a fine of RM 10million ($2.4 million).
In the recent announcement, the market regulator again warned the unregistered crypto exchanges about the consequences they would face if they continue their operations.
“DAX operators who have not been approved by the SC are required to cease all activities immediately and return all monies and assets collected from investors,” the press release noted. “Operating a DAX without authorization from the SC is an offense under securities laws and a person in breach may be liable to a fine or imprisonment term or both.”