Malaysia's second finance minister has said the government will not ban the trading of bitcoin and other cryptocurrencies, though it will remain cautious on the technology.
In an interview with The Malaysian Reserve, Johari Abdul Ghanis emphasised the importance of "striking a balance between public interest and integrity of the financial system," adding that to ban cryptocurrencies would harm fintech innovation.
Johari told the news source:
However, Johari added that Bank Negara Malaysia (BNM), the country's central bank, will in future ensure cryptocurrency exchanges conduct customer due diligence and report suspicious transactions.
As with any investment schemes, Johari said, "there is a need to have proper regulation and supervision to ensure any risk associated with such schemes are effectively contained."
BNM published its draft guidelines to cover cryptocurrency exchanges in December, as reported by CoinDesk.
The minister further discussed the importance of fintech innovation for Malaysia, saying it would boost economic productivity, as well as "make financial intermediation more seamless." Digital currencies and e-wallets should be included in Malaysia’s digitalisation roadmap, he added.
On a concluding note, Johari argued that it was important for authorities to have a sound understanding of cryptocurrencies before bringing in new policies and regulations.
"This is particularly relevant to recent innovation like bitcoin, which remains unregulated globally and not battle-tested against shocks, unlike more conventional mediums of exchange," he told the Reserve.
Malaysian parliament image via Shutterstock
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish group, owner of Bullish, a regulated, institutional digital assets exchange. Bullish group is majority owned by Block.one; both groups have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.