Malaysian government should embrace crypto as legal tender in order to engage youth

Malaysia’s deputy minister of communications and multimedia told parliament Monday that the government should explore adopting cryptocurrencies such as Bitcoin as legal cash, according to local news outlet The Star.

The deputy minister, Zahidi Zainul Abidin, said that the communications ministry is examining ways to legalise cryptocurrency “in order to encourage young adoption,” but he emphasised that financial regulation is “within the jurisdiction of Bank Negara Malaysia and the Securities Commission.”

El Salvador is currently the only country that has adopted Bitcoin as legal money. Malaysia has not previously stated its position on crypto as legal cash, but it has been collaborating with the Bank for International Settlements, Singapore, Australia, and South Africa on a central bank digital currency (CBDC) initiative to test cross-border CBDC transactions.

“The inevitable follow-up question, like with any cash or legal tender, is what can I purchase with it? What am I able to do with it? What can I do with it?” According to Henry Chong, CEO of Malaysia-based digital securities exchange Fusang Corp.

According to Chong, Labuan, a Malaysian mid-shore jurisdiction where Fusang is controlled, has licenced over 80 digital enterprises that are developing an end-to-end digital ecosystem.

“While a currency is good for transferring value, it is not an investment in and of itself, and the potential for consumers to utilise cryptocurrencies to invest in genuine items, securities, and so on, really opens up a new universe of investment opportunities for retail investors,” Chong added. “The next stage is to enlist the support of established banking institutions.”

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