Despite a low rate of digital asset adoption within the region, the Securities Commission of Malaysia supports the use of cryptocurrencies and says it has excellent potential.

Speaking at the 2020 SCxSC Virtual Fintech Conference, Dr. Daud Bakar, Chairman of the Securities Commission ( SC) Malaysia Shariah Advisory Council, discussed the cryptocurrency problem and how Malaysia’s investors still have a new emerging market.

He said that digital assets’ general knowledge still needed to be improved within the country, as cryptocurrencies and digital asset investments were known to only 2 percent of the total Malaysian population.

Speaking on behalf of the Shariah, Bakar clarified that as long as it was not funded by “ribawi products,” such as gold and silver, crypto was considered a legitimate commodity that could be traded in the market. He said that cryptocurrency was a means of trade, as shared by local news outlet The Malaysian Reserve, and they would not stop people from using commodities as an exchange medium.

It was just as good an advantage as e-tickets or other goods on the market, he said. The chairman said that its implementation in Malaysia could revolutionize the market structure with the growth of cryptography.

The chairman of the SC also discussed how global digital transformation took place, including Malaysia, and how the COVID-19 pandemic led companies worldwide to a new digital standard. He said the potential of digital currencies was great, as is the case at a time when a wave of digital transformation is taking place around the world.

In Malaysia, cryptocurrency development has steadily progressed, with three cryptocurrency exchanges officially licensed within the country. The three-coin exchanges promote Bitcoin (BTC), Ethereum ( ETH), and Ripple (XRP) trades.

Nevertheless, the adoption of digital currencies is still relatively recent in Malaysia, as it has been just three months since the exchange of digital assets was legitimized under Islamic law.

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