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Source: Lawyer Liu Honglin
Malaysia has a strong and diverse economic and low inflation rate, which makes it one of the world’s most stable currencies. At present, Malaysia is very friendly to the cryptocurrency supervision environment and allows the approved assets to be approved by transactions. HoweverThe exchange must comply with the provisions of the Malaysian Securities Supervision Committee (SC) and abide by local laws.
From the perspective of policy trends,Malaysia intends to build itself as an Asian cryptocurrency center to challenge the central position of Hong Kong and Singapore in the encryption field.Malaysia is steadily expanding its ecosystems of its venture capital company and web3 startups. Among them, Coingecko is a successful case worth noting.
From a legal environment,Malaysia’s attraction in the field of encryption is attributed to factors such as ordinary legal court systems, English proficiency, and its sound regulatory framework.Including cryptocurrencies without capital gains tax and high labor education, and the main advantages of using English, this helps enhance Malaysia’s overall attraction.
01MalaysiaDevelopment of cryptocurrency legal policies
In Malaysia, cryptocurrencies are legal.The Malaysian government has formulated relevant laws and regulations to ensure the stability and transparency of the cryptocurrency market.However, as an emerging market, its regulatory agencies and regulators are still working hard to understand and follow up the development of cryptocurrencies, and take measures to protect investors from possible risks.
In Malaysia, cryptocurrencies are regarded as property.This is a basic legal issue, because property can be owned, and is given ownership that can be implemented around the world.With the provisions of Article 3 of the Civil Law Regulations in 1956, the use of the British ordinary law has become a long -term practice of the Malaysian courts.Therefore, it is meaningful to discuss the attitude of the British court.In October 2018, the Malaysian court tried a case related to cryptocurrencies.The court ruled that although cryptocurrencies were not the legal currencies in the country, cryptocurrencies trading was not illegal.The most important thing is that the court attributed cryptocurrencies into goods, because it was a legal currency for buying cryptocurrencies, and the method of measured cryptocurrencies was the same as the shares.
Malaysia formulated the “Capital Market and Services) Act (Digital Currency and Digital tokens) in 2019” (2019 Act 2019), which incorporates cryptocurrencies (also known as digital currencies) into the scope of supervision.According to the 2019 law, all digital currencies and digital tokens that meet the standards stipulated in the 2019 Act will be identified as securities stipulated in the Malaysian Securities Law.Nevertheless, the Malaysian Securities Regulatory Commission still clearly states that digital currencies and digital tokens are neither illegal currency nor a payment method for the supervision of BNM (also known as the National Bank of Malaysia, hereinafter referred to as “BNM”).
After the 2019 law order was promulgated, the Malaysian Securities Regulatory Commission also announced the “Digital Assets Guidelines” in 2020, which took effect on October 28, 2020.The guidance stipulates the requirements related to the following matters: through the activity of raising funds raised by digital tokens, the first -time exchanges’ issuing platform is put into operation to keep, storage, hold or custody digital assets for others.In 2020, the guidelines were allowed to allow the Malaysian Securities Regulatory Commission to exempt certain requirements of the guidelines after applying for the application, which gave supervision a certain flexibility.
In January 2021, the Malaysian Securities Regulatory Commission revised the 2015 “Approval Market Guide” to implement new requirements for electronic platforms that provide convenience for digital asset transactions.
SC (Malaysia Securities Supervision Committee) has approved transactions of crypto assets such as BTC, ETH, Avax, MATIC
02Malaysia’s tax policy for cryptocurrency transactions
In Malaysia, cryptocurrency transactions, including the lack of capital gains tax, are usually tax -exempt.
However, active cryptocurrency transactions may classify individuals as daily traders may allow them to pay 3% to 30% of income tax, specifically depending on the income level.To be identified as daily traders, it is necessary to meet certain standards, such as a large number of transactions, short -term holdings, high -frequency transactions, and striving to increase market and commercial motivation.Evidence must be provided to LHDN (Malaysia Taxation Bureau) to prove that individuals are not traders, but to hold cryptocurrencies for investment purposes to avoid taxes.
03Suggestions for future investors
The potential development and changes of the Malaysian cryptocurrency supervision environment are still unclear.The Malaysian Securities Committee (SCM) and the Central Bank of Malaysia (BNM) have not yet issued official laws and regulations on cryptocurrency transactions and investment activities.The cryptocurrency exchanges are currently constrained by some voluntary behavior standards formulated by industry organizations such as ACCESS MALAYSIA.
As cryptocurrencies are becoming more and more popular globally, both SCM and BNM may formulate formal regulatory policies in Malaysia.These development may limit some aspects of trading activities or levy new taxes on encryption transactions.However, the Malaysian government believes that cryptocurrency and blockchain may promote the development of the domestic economic development.The alternative fundraising channels of home and new enterprises can also be used as an alternative assets for investors. “
Therefore, the Malaysian government will hold a friendly attitude towards cryptocurrencies and blockchain for a long time, and intends to build itself as an Asian cryptocurrency center to challenge the central position of Hong Kong and Singapore in the encryption field.
