Why Crypto Ventures Stall
We Start With the Perimeter Question
Almost every crypto venture we advise arrives with the same question framed the wrong way. They ask whether crypto is legal in Malaysia. The real question is narrower and much more consequential: does this specific asset, and this specific activity, fall inside the securities perimeter. If it does, the Securities Commission regulates it and registration is not optional. If it does not, a different set of rules applies. Building the product first and asking afterwards is how ventures end up unwinding things that were expensive to build.
How We Support Digital Asset Businesses
Structure that survives a regulator's reading.
We work through the classification question first, then the corporate and commercial structure around it — platform and operator compliance, token and offering documentation, terms of service, governance frameworks, and the contracts and fundraising documents any technology venture needs.
Choose Where You Are Now
Select the service your venture needs next.
Classification, structure, compliance or fundraising. Pick where you are and we will start there.
In Malaysia, digital assets can be securities. The Capital Markets and Services (Prescription of Securities) (Digital Currency and Digital Token) Order 2019 came into force on 15 January 2019 and prescribes digital currencies and digital tokens as securities where they meet the criteria set out in the Order. Where they do, the Securities Commission Malaysia regulates the activity under the Capital Markets and Services Act 2007. Where they do not, a different analysis applies — and getting that determination right is the first piece of work, not the last.
When is a digital asset a security?
The Prescription Order sets criteria rather than a blanket rule, distinguishing between digital currencies and digital tokens and applying tests to each. For digital currency, the criteria include whether it is traded on a facility where offers to sell, purchase or exchange are regularly made or accepted, whether a person expects a return from trading, conversion, redemption or appreciation, and whether it is issued or guaranteed by a government body or central bank as specified by the Commission.
This is a classification exercise on the specific asset and the specific arrangement. It should be done before the token is designed, because the design drives the answer.
What activities require SC registration?
Activity | Position |
|---|---|
Operating a digital asset exchange | Registration as a recognised market operator with the SC |
Initial exchange offering of digital tokens | Conducted through an SC-registered IEO platform operator |
Digital asset custody | Registration with the SC as a digital asset custodian |
Broking prescribed digital assets | Available to capital markets services licence holders subject to SC requirements and prior notification |
The framework has been extended since 2019 and continues to develop, including amendments to the Prescription Order. Confirm the current registration categories and requirements with the SC before designing an operating model around them.
What is Bank Negara's role?
Digital currencies are not legal tender in Malaysia. Bank Negara Malaysia's interest is in the financial system perimeter — payments, money services, and anti-money laundering obligations for reporting institutions. A model that touches fiat on-ramps, payments or remittance needs to be assessed against the BNM perimeter as well as the SC one, and the two questions are separate.
What else should a digital asset venture get right?
The unglamorous things that decide whether the venture survives success: a corporate structure that can take investment, founder vesting and IP assignment, terms of service that allocate risk sensibly and are actually incorporated, a data protection position that reflects the amended PDPA including mandatory breach notification since June 2025, and governance that will withstand scrutiny from a regulator or an institutional investor.
Ventures in this sector are diligenced harder than most. Documentation that would pass unnoticed elsewhere gets read line by line here.
Frequently Asked Questions
Is cryptocurrency legal in Malaysia?
Trading and offering digital assets is permitted where conducted within the applicable framework — which for assets prescribed as securities means through SC-registered platforms and operators. Digital currencies are not legal tender. The lawfulness of a specific activity depends on how the asset is classified and how the activity is conducted.
Can we issue a token to raise funds?
Token offerings that fall within the securities perimeter are conducted through SC-registered IEO platform operators and are subject to the SC's requirements. Issuing outside that framework where it applies is not a compliance shortcut — it is an unregistered offering.
Do we need registration if our users are outside Malaysia?
Territorial application depends on where the activity is carried on and who is being offered the product, and the answer is rarely as clean as a website disclaimer suggests. Get specific advice rather than relying on a geoblock.
Where to start
For platform and offering compliance, see equity crowdfunding and P2P platform compliance. For structure, see company incorporation and structuring and shareholders agreements for startups. For the user relationship, see website terms of use and privacy policy and the PDPA compliance framework.
This page is general information about Malaysian law and does not constitute legal advice. Licensing requirements, thresholds and guidelines change. Confirm the current position with the relevant authority or your adviser before acting on any part of it.
