Malaysia Eyes Crypto Framework Following UAE and Binance CZ Discussions

The Malaysian government is reportedly considering the development of a cryptocurrency policy aimed at integrating the industry into the nation's financial system.

Prime Minister Datuk Seri Anwar Ibrahim recently discussed potential regulatory frameworks with Abu Dhabi officials and Binance founder Changpeng Zhao (CZ).

Anwar emphasized the importance of adopting cryptocurrency-friendly regulations to stay competitive in the global financial landscape.

Anwar said at the end of his three-day official visit to Abu Dhabi:

“We have talked about digital transformation, data centres and artificial intelligence (AI). We now face demands which require us to think about making significant changes. I had lengthy discussions with the Abu Dhabi leadership and Changpeng Zhao, co-founder of the world's largest cryptocurrency platform, Binance.”

He revealed that several months ago, he proposed that agencies such as the Treasury, Bank Negara, and the security sector collaborate on a study to explore how Malaysia could strategically navigate this space without falling behind.

Regulating the sector, he argued, would help protect public interests and minimise risks.

Thorough Government Studies Key to Policy Shifts

Anwar noted that policymakers in the United Arab Emirates (UAE) are keen to collaborate with Malaysia in developing its cryptocurrency regulatory framework:

"However, this innovation is just like AI, which would revamp the financial world. We should not sit idly by and wait and later be forced to do so after others have done it already."

He pointed to the UAE's leadership in the sector as a valuable example, suggesting Malaysia could benefit from the experiences of both the UAE and major industry players like Binance:

"They (UAE leaders) feel that they can forge a close cooperation with Malaysia on this issue. We need to discuss this in detail, leave behind the old business model and give meaning to this digital finance policy. We have discussed at length about fintech. But when something new comes about, we get agitated. I hope we can be more open to this. I am leaning towards not just approving but also expediting this."

Anwar emphasized that Malaysia would not be starting from scratch but would instead leverage global expertise:

"This is an evolution which happens quickly and requires us to be equally fast. We feel that Malaysia should not be left behind while mired in an old financial system."

Once the policy is established, further comprehensive studies by key Malaysian authorities—such as the Treasury, the Securities Commission, and Bank Negara Malaysia—will be necessary to address potential concerns.

He continued:

“As with all new ideas raised, there will be some concerns. We have to train our personnel, develop competency, and get the players to participate. What is pertinent is that we have excellent relations with the UAE. We told them that we would move on this on the condition that we work as partners to ensure that things are on track. This will be a radical departure from the old ways.”

Anwar also revealed plans to consult the cabinet on the matter, with a formal proposal set to be drafted and presented for endorsement in the near future.

CZ also posted on X (formerly known as Twitter) in support of Malaysia's new stance on blockchain.

Industry Faces Scrutiny from Malaysia's Securities Regulator

Anwar 's push for crypto-friendly regulation comes amidst growing scrutiny from Malaysia's Securities Commission.

On 27 December, the regulator ordered Bybit, a major crypto exchange, to cease operations in the country, citing its status as an unregistered digital asset exchange.

This action followed a similar move on 23 December, when the Commission added Atomic Wallet to its investor alert list, alongside other industry giants like Paxful, KuCoin, and MEXC.

These platforms were flagged for operating crypto exchanges in Malaysia without proper registration, highlighting the need for clearer regulatory guidelines in the sector.