The Securities Commission of Malaysia makes positive moves in facilitating regulations of digital asset exchanges. Last year, the SEC of Malaysia set terms of operations for digital assets, and now the agency published a list of digital asset exchanges permitted to continue their operations. In total, 22 companies are on the list. Of the 43 existing exchanges, 21 did not submit an application to operate under the new terms, hence, according to SEC, they “are required to take the necessary steps to cease their business and return all clients’ assets”.
Exchanges of digital assets allow users to buy, trade and sell hundreds of various types of digital assets. While some exchanges allow for the trading of digital assets for other digital assets, some allow trade of digital assets for fiat currencies and vice versa.
Although the global digital asset market has experienced immense periods of volatility in recent years, reports show that the market, which was initially valued at about US$800 billion in 2017, is expected to reach about US$3.6 trillion by 2025. This growth invariably could be linked to the rise in the demand for digital payments and transactions.
There are currently over 300 exchanges facilitating the trade of digital assets globally. However, despite these and the market worth, the majority of these exchanges do not have proper regulatory frameworks. Thus, the protection of traders and institutions in the market is not fully guaranteed.
However, the regulation of exchanges currently varies from country to country. While countries like China and India consider the exchanges illegal, other countries like Malta, Switzerland and Singapore consider them legal. The United States has varying regulations depending on the state of operation.