Malaysia introduces digital asset guidelines
This article appeared in the Asia First Newsletter of Tuesday January 21, 2020
The Securities Commission (SC) Malaysia has introduced guidelines related to digital assets, which outline the framework for token sales. Under the new guidelines, all digital token offerings must be done via an initial exchange offering (IEO) platform operator approved by the SC. The IEO platform operators are required to register with the SC and have a minimum paid-up capital of MYR5m (USD1.23m). They need to carry out the required assessment and due diligence on the token issuers and the token features. The SC also said that issuers planning to engage in fundraising through token offerings must be company incorporated, with a locally run main business and a minimum paid-up capital of MYR500,000.
The commission added that they must demonstrate that their proposed project or business provides an innovative solution or a meaningful digital value proposition for Malaysia. Issuers are allowed to raise funds up to MYR100m and tap on investments from retail and sophisticated investors as per the investment limits mentioned in the guidelines. The guidelines will take effect in the second half of this year.