Malaysia’s Securities Commission (Suruhanjaya Sekuriti Malaysia) has issued full approval to Tokenize Malaysia to operate a digital asset exchange (DAX) despite the ongoing nationwide lockdown due to the Covid-19 pandemic. The lockdown, originally imposed in mid-March, has been extended until at least April 14 as the government ramps up aggressive testing to contain the virus.
Approval During Lockdown
According to several local media reports on Friday, Tokenize Malaysia received full approval from the Securities Commission Malaysia (SC) to operate as a DAX. The platform can now begin accepting clients. Tokenize Malaysia CEO Hong Qi Yu told the Malaysian national news agency Bernama: “The digital asset industry is by far one of the best equipped and it is business as usual for us as the industry is used to working and communicating effectively across time zones and managing teams remotely.”
Malaysia’s Crypto Regulatory Framework
The approval follows the implementation of the Capital Markets and Services (Prescription of Securities) (Digital Currency and Digital Token) Order 2019, which came into force on January 15, 2019, to regulate DAX operators. Under this framework, the SC has registered three recognized market operators (RMOs) to establish and operate cryptocurrency exchanges in Malaysia: Luno Malaysia, Sinegy Technologies, and Tokenize Technology. Out of 23 crypto exchanges that applied, only these three received any form of approval. Luno became the first to meet all regulatory requirements and received full approval earlier. Tokenize now becomes the second fully approved exchange. The SC also published digital asset guidelines in January 2020 outlining requirements for digital token offerings.
Strict Enforcement
The regulator has previously clarified: “Entities which have not been approved by the SC, including those which have previously been operating under the transitional period, are required to cease all activities immediately and return all monies and assets collected from investors.” This strong stance highlights Malaysia’s commitment to combating unregulated crypto activities while supporting compliant players during the crisis.
Japan Sets Parallel Example
Last week, Japan also approved a new cryptocurrency exchange to operate in the country despite the coronavirus pandemic, bringing the total number of registered crypto exchanges in the Land of the Rising Sun to 23. The concurrent approvals in two major Asian economies underscore the resilience of the digital asset industry and the willingness of regulators to continue licensing even during a global health emergency. The global recession declaration by the IMF, which noted that 80 countries have requested financial help, further highlights the importance of alternative financial systems that crypto exchanges can provide.
The approvals in Malaysia and Japan demonstrate that regulatory progress in the crypto space does not stop, even when economies are shut down. As more countries explore digital asset regulation, the Malaysian model of conditional approval followed by full licensing may serve as a template for other emerging markets.