The Shariah Advisory Council of Securities Commission (SC), Malaysia has authorized digital assets trading, as the council is the authority that oversees the implementation of Islamic laws in the operation of Islamic Financial Institutions.
It has been reported that during a teleconference panel session during Invest Malaysia 2020 on 7th July, 2020, Datuk Syed Zaid Albar, the Chairman of Securities Commission, Malaysia said that:
“The SC Shariah Advisory Council has resolved that in principle, it is permissible to invest and trade in digital currencies and tokens on registered digital asset exchanges.”
Currently, Datuk Syed Zaid chairs the Capital Market Development Fund (CMDF) and is a member of the Board of the Financial Reporting Foundation (FRF), as well as a member of the Debt Management Office, Ministry of Finance. He is also the Vice Chair of the International Organization of Securities Commissions (IOSCO) Growth and Emerging Markets (GEM) Committee and Co-Chair of the IOSCO GEM Committee Working Group on Sustainability in Emerging Markets.
He also added:
“This is a really ground-breaking resolution by the SAC (Shariah Advisory Council) that could spur greater development and investment in digital assets. Once the resolution is finalised, we will issue further details.”
Likewise, Kelvyn Chuah, the founder of SINEGY, said that the announcement bears extreme significance as more than 60% of Malaysians are Muslims.
Chuah added:
“At the same time, Malaysia is aiming to be the hub of Islamic Finance and fintech. This announcement does clear the many ambiguities still tied to digital assets.”
HAPPENING NOW Datuk Syed Zaid Albar, Chairman of the Securities Commission of Malaysia, gives his keynote address #FutureOfFintech #SmartShowcaseSeries #ASEAN #4IR pic.twitter.com/Ue8KFgs8Dg — CIMB ASEAN Research Institute (@Cariasean) August 15, 2019
He further stated by explaining the stance of the Shariah Advisory Council regarding digital assets:
“Currently all regulated digital asset trading is permissible while there are several non-compliant activities that will remain disallowed.”
Also, Chuah explained that as the Malaysian Muslim community awaits a Shariah-compliant resolution for trading digital assets, companies like SINEGY can now explore potential services that may welcome more Muslims into the digital asset space.
Thus, he concluded:
“The industry is closely waiting for SC’s full guidelines on digital asset token issuance. We also think that the regulators may be looking at having a regulated digital asset derivatives market in the mid-term future.”
Around the world, the financial regulators are currently working on enforcing strict crypto regulations to regulate the crypto industry better. However, most of the cryptocurrencies are still in a grey area. On July 8, 2020, the Securities Commission Malaysia (SC) cautioned the public against the usage of Crypto Automatic Teller Machines (Crypto ATMs). Members of the public may verify if a digital asset operator is registered with the SC at https://www.sc.com.my/development/digital/digitalassets.
Source: Cointelegraph | Image: Fintechnews SG