More and more countries are coming against the ICO model indicating that the era of ICOs might just be coming to an end. Malaysian Finance Minister Lim Guan Eng announced that all token offerings and exchanges trading will require registration with the Securities Commission (SC).
Lim added that all such instruments and their associated activities must be first approved by the SC and need to comply with the relevant securities laws and regulations. The full framework on digital assets is expected to be released by the end of Q1 2019.
If a firm fails to comply with the set rules, it will be met with harsh punishments, such as imprisonment of up to 10 years and fines of up to 10 million Malaysian ringgits (an excess of $2.4 million). Lim said that the Securities Commission would put in place the regulatory requirements for the issuance of ICOs and the trading of these digital assets at digital asset exchanges in Malaysia.
Lim stated that The Ministry of Finance (MOF) views digital assets, as well as its underlying blockchain technologies, as having the potential to bring about innovation in both old and new industries. “In particular, we believe digital assets have a role to play as an alternative fundraising avenue for entrepreneurs and new businesses, and an alternate asset class for investors,” added Lim.
Malaysia is currently overshadowed by the other Asian countries like Singapore in terms of being crypto friendly but it can be concluded that these new regulations should not be seen as hostile to security tokens. Malaysia is aiming to build a new era of regulated tokenized securities.