Malaysia
Answer ... In Malaysia, ‘virtual currencies’ have been legally defined as ‘securities’ as per the Capital Markets and Services (Prescription of Securities) (Digital Currency and Digital Token) Order 2019, with the generic name of ‘digital currency’/‘digital token’ or, more commonly, ‘digital assets’.
In summary, a ‘digital asset’ is a digital representation of value or otherwise which is recorded on distributed ledger technology, whether cryptographically secured or otherwise.
A lawsuit is pending in the Malaysian courts involving the definition and/or judicial treatment of digital assets. Robert Ong Thien Cheng v Luno Pte Ltd was initiated in the Sessions Court of Malaysia, where Luno filed a claim against Ong to return Bitcoins that had been mistakenly transferred by Luno. Luno won in the Sessions Court.
Ong appealed unsuccessfully to the High Court of Malaya. He filed a final appeal to the Court of Appeal, where the matter is now pending. The main argument of law articulated in the High Court was whether Bitcoin is a ‘thing’ capable of being returned under Section 73 of the Contracts Act 1950, which states: “Liability of a person to whom money is paid, or thing delivered, by mistake or under coercion, must repay or return it” (emphasis added).
The High Court judge who heard the appeal from the Sessions Court – the Honourable Gunalan A/L Muniandy v agreed with the Sessions Court judge that cryptocurrency is a form of commodity as real money, even though it is not legal tender.
However, he went on to decide that as cryptocurrencies have been defined as securities in Malaysia, there is indeed value attached to Bitcoins, in the same way that value is attached to shares. In short, Bitcoin is thus a ‘thing’ that is capable of being returned under the Contracts Act.
This is the latest judicial treatment of cryptocurrency to date; the decision of the Court of Appeal – the second-highest ranking court of law in Malaysia after the Federal Court – is now awaited.
Malaysia
Answer ... The regulator does not differentiate between initial coin offerings and securities token offerings in Malaysia, as cryptocurrencies have been defined as securities. Therefore, all kinds of cryptocurrencies are securities in Malaysia and fall under the purview and jurisdiction of the Securities Commission.
Malaysia
Answer ... There are no clear guidelines or regulations concerning stablecoins or stable tokens. They will thus still fall under the category of securities.
Electronic money falls under the jurisdiction of the Central Bank of Malaysia. The Central Bank has made it very clear that cryptocurrency is not legal tender in Malaysia.