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Malaysia’s Ministry Backs Proposal To Legalize Cryptocurrency

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Malaysia’s Deputy Minister of Communications and Multimedia Datuk Zahidi Zainul Abidin put forward his intention to legalize digital currencies. Zahidi said the move would help the younger generation who are active users of the currency, especially on non-fungible token [NFT] trading platforms.

The Minister said the department will look into ways to increase the youth’s involvement in digital assets which he claims is the future of finance.

“All of these are under the purview of Bank Negara Malaysia and the Securities Commission. We hope the government will allow and legalize this so that we can increase the youth’s uptake of cryptocurrencies.”

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Zahidi also spoke about the government’s stand on trading on NFT platforms, which was becoming more popular, especially among the younger generation.

That being said, Malaysia’s Communications and Multimedia Ministry oversees the digital and broadcasting sectors didn’t specify under which ministry digital assets come.  While financial regulation falls under the central bank and the securities regulator, the Ministry of Housing and Local Government also has jurisdiction over “digital financial activities,” Zahidi said. 

Malaysia’s legal crypto adoption will lead to bullish price action

Following the news, the crypto community went into a tizzy. Entrepreneur and VanEck’s digital asset initiatives strategist, Gabor Gurbacs tweeted that the country’s population stood at around 30 million and its GDP is 35th in the global ranking, next to Hong Kong. “I wouldn’t be surprised if G20 countries also made similar moves,” he added.

Another user commented, if it turns into reality, Malaysia will be the second country after El Salvador in accepting crypto as legal tender. This news would provide a much-needed boost and expects ‘a good spike in the price of crypto’.

However, the Bank Negara Malaysia which is its Central Bank hasn’t announced any formal position on adopting Bitcoin as legal tender. In an interview back in January, the top bank said that it’s examining whether to introduce its own digital currency or CBDC. At the time of this post, the bank didn’t respond to Zahidi’s remarks. 

Last September, the Asian nation worked collectively with the Bank for International Settlements, Australia, Singapore, and South Africa to test the use of CBDCs for international settlements through a shared platform dubbed Project Dunbar. 

Malaysia’s Illegal Bitcoin Miners Stole Electricity Worth $550 Million

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Power theft for bitcoin mining is an increasing concern in Malaysia. However, the national utility has a few suggestions for curtailing the behavior.

Tenaga Nasional’s senior executive announced on Thursday that the company had suggested a special rate for bitcoin mining firms in order to combat power theft. It also indicated that the Energy Commission encourages bitcoin miners to register for lawful energy supply.

Tenaga, whose largest stakeholder is Malaysia’s national wealth fund Khazanah Nasional, is seeing an increase in the number of incidents where energy is being used illegally to mine cryptocurrencies. In an interview, the president and CEO Baharin Din stated that he expects the number to climb.

Cryptocurrency mining – an energy sucking activity

Cryptocurrency mining, a time-consuming and energy-intensive computational process used to produce bitcoin and other tokens, has spread like wildfire throughout the world as the value of digital assets has skyrocketed.

While various attempts have been made to make the process more ecologically friendly, it is still considered hostile in many cases.

Cryptocurrency mining is not against the law in Malaysia. However, some miners steal power by interfering with meter installation or bypassing the meter and establishing an unauthorized connection.

According to Tenaga, there were 7,209 energy theft cases by illicit bitcoin miners in 2021, up from 610 in 2018.

Tenaga has been collaborating with Malaysia’s anti-corruption agency, police, the Energy Commission, and local governments to apprehend power thieves, particularly bitcoin miners.

According to Baharin, 18 people were detained between 2018 and 2021 for an estimated 2.3 billion ringgit (US$550 million) in energy theft.

According to Paul Lim Pay Chuan, managing director, and group chief executive officer of Pestech International, technology can also assist a Malaysian electrical power technology business.

“Implementation of the likes of smart metering, meter data management systems, analytic software, and digital power quality products will greatly enhance the availability of critical power demand and supply information,” he said.

“That may give the utility such up-to-date data for greater monitoring, planning, and control over the entire ecosystem – which includes prevention of power theft.”

Given that bitcoin mining is illegal in Malaysia, it’s unclear how they would execute the idea if it passes.

Overall, digital currency legislation in Malaysia is still a contentious issue. Malaysia’s Deputy Finance Minister Yamani Hafez Musa recently stated that cryptocurrencies are not a financial alternative.

According to their government sources, digital currencies have not demonstrated the characteristics of a worldwide currency.

BIS’s latest project urges Australia, Malaysia, Singapore, and South Africa to test cross-border CBDCs

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The Bank of Internation Settlements’ aka BIS has been keeping an eye on the development of central bank digital currencies [CBDC] across the globe. In order to further spruce up the process, the bank hopes to initiate the whole cross-border system for CBDCs.

CBDCs have started to steer the world in a whole new direction. These central bank-issued assets seem to be the latest interest of governments across the globe. An array of countries have already developed the digital version of their fiat currency, however, a few others are still stuck in the research process. China has been at the top of the game as it has its asset already in use.

Now with an aim to get ahead in the race, BIS has urged the central banks of four regions namely, Australia, Malaysia, Singapore, and South Africa to join the bank’s latest initiative, Project Dunbar.

BIS’s Project Dunbar to focus on cross-border CBDCs

The aforementioned central banks have been working along with BIS to roll out a prototype that carries out cross-border CBDCs. The reason behind this is to uphold direct transactions and eliminating the requirement of intermediaries. With this prototype, the banks hope to diminish time as well as the cost of transactions.

Furthermore, the project would look into the “international dimension” of the design of the CBDC. Andrew McCormack, Head of the BIS Innovation Hub Centre in Singapore, would reportedly overlook the project.

Speaking about the same, McCormack said,

“Project Dunbar brings together central banks with years of experience and unique perspectives in CBDC projects and ecosystem partners at advanced stages of technical development on digital currencies. With this group of capable and passionate partners, we are confident that our work on multi-CBDCs for international settlements will break new ground in this next stage of CBDC experimentation and lay the foundation for global payments connectivity.”

Several bank officials from across the globe believe that this project could be great for the CBDCs of different countries.

Binance drowns in troubled waters as regulatory pressure surges

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Of late, Binance has been making news following regulatory pressure from all across the globe. This stress seemed to be increasing as regulators from India as well as Malaysia have got their eyes on the world’s largest cryptocurrency exchange.

Over the last few weeks, Binance has been undergoing immense scrutiny particularly from regulators in the UK, Japan, and Ontario. While the exchange has been dealing with this, a few other countries decided to join the list. India’s stance on the crypto-verse has always been puzzling, however, this time Malaysia went on to take down the exchange.

In a recent announcement, the Securities Commission of Malaysia released a statement asking Binance to put a hold on all its entities in the region. The regulator gave the crypto exchange a window of 14 days starting from 26 July to address the issue and take down its mobile application as well as the website. Additionally, any sort of campaign through media was also asked to be discontinued.

The announcement further read.

“Investors are advised to stop dealing with and investing through illegal DAX. Those who currently have accounts with Binance are strongly urged to immediately cease trading through its platforms and to withdraw all their investments immediately.”

Along with this, Bloomberg revealed that an anti-money laundering entity in India was probing Binance. The regulator would reportedly question the exchange about its association with a Chinese betting application. Even though nothing has been discovered, WazirX has been under the purview of the government for allegedly being a part of a $134 million money laundering case.

Binance ceases futures and derivatives functions across Europe

Amidst the exchange’s fallout with the UK, it was seen shutting shop. The exchange has elevated its move of steering away from Europe and has decided to terminate its futures and derivatives function. Users from Germany, the Netherlands, and Italy would be barred from creating new futures or derivatives accounts.

Malaysia destroys over 1,000 BTC mining machines

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China has been making news lately following the ousting of an array of crypto mining firms from the country. Malaysia has taken a different step; this one, however, serves those who have been stealing electricity,

Crypto mining emerged as a prominent field as it came with attractive benefits. While some were genuinely interested in crypto, a few others wanted to pocket some easy money. The latter group has no setup but is quite often caught stealing electricity. Mining crypto is power-consuming. A lot of power is required to mine these assets; this further eliminates the chances of anyone and everyone mining crypto. Therefore, several go on to steal electricity for the sole purpose of mining these digital assets.

Malaysia has been taking different measures to address the situation. The region’s Miri district police have been destroying illegal Bitcoin mining equipment.

Malaysia destroys an array of mining equipment

According to a Malaysian news portal, The Star, a total of crypto mining machines worth $1.26 million were destroyed. These machines were reportedly a part of illegal mining farms that were stealing electricity from the Sarawak Energy Berhad (SEB). The 1,069 Bitcoin mining machines were slain at the Miri district police headquarters.

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This operation was led by the Miri police and the Sarawak Energy Berhad (SEB) joined in on the case. The investigation took place throughout February all the way till April. Furthermore, the Miri police arrested about eight people involved in the case.

Miri police chief ACP Hakemal Hawari spoke about the case and stated,

“A total of six people have been successfully charged under Section 379 of the Penal Code for electricity theft and have been fined up to RM8,000 and jailed for up to eight months. The electricity theft for mining bitcoin activities has caused frequent power outages and in 2021, three houses were razed due to illegal electricity supply connections.”

Malaysian authorities nab four illegal crypto miners with 441 BTC mining machines

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Malaysian police have managed to take down a massive illegal mining rig that involved over 441 Bitcoin mining gears.

The crypto industry’s mining process has garnered a lot of attention over the years due to the rewards that come with it. The value of BTC has witnessed drastic growth particularly over the last couple of months and has even managed to amass the attention of the globe. With this, mining rewards have also observed an increase further enticing more individuals into it. This, however, comes with a lot of setbacks. While many have expressed concerns over the environmental damages caused by the whole mining process, governments across the globe have been worried about electricity thefts.

Malaysian illegal mining crackdown

The entire Bitcoin mining process consumes a lot of electricity making it difficult for just anyone to execute it. In the Malaysian state of Penang, authorities busted a crypto mining rig. The Malaysian police managed to seize a total of 441 machines that were used for mining cryptocurrencies. While these machines were worth a whopping RM180,000.

The police had reportedly carried out a total of four raids and managed to nab four suspects associated with the case. The George Town OCPD Asst Comm Soffian Santong elaborated on the same and stated,

“During the raids at Lintang Hajjah Rehmah, Jelutong, Sungai Dua, and Bayan Lepas, police also confiscated four computers, 11 routers, four modems, and 10 fans.”

The aforementioned suspects have been booked under the Section 379 and Section 427 of the Penal Code along with the Section 37 of the Electricity Supply Act 1990.

Furthermore, the police found that all the premises that were raided were stealing electricity to conduct Bitcoin mining activities. The Tenaga Nasional Berhad [TNB] had even endured losses up to  RM420,000.

While the person behind the entire plan is still on the run, the Malaysian police have been intensively searching for the person running this rig for the last couple of months.

Malaysian Financial Platform To Venture Into Crypto With Its Latest Investment

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The crypto industry managed to lure in many. A prominent financial firm in Malaysia is the latest to jump on the bandwagon. The price change of Bitcoin over the last two months along with the market cap of the industry hitting a whopping one trillion stood as a shimmering quotient for many. At the time of writing, Bitcoin was trading for a high of $47,969 with a 23.36% surge in the last 24-hours. The overall market cap of the crypto market was also at an all-time high of $1.37 billion.

Malaysia To Spruce Up Crypto Adoption

In a recent blog post, it was announced that the Kenanga Investment Bank Berhad had initiated a conditional agreement with a crypto exchange in the country through its entirely-owned private equity arm, Kenanga Private Equity Sdn Bhd. The agreement would allow the financial firm a 19% equity stake in the crypto exchange.

The Malaysian financial giant would reportedly pour its money into Tokenize Xchange’s Tokenize Technology, a crypto platform regulated by the Securities Commission of Malaysia. Tokenize Xchange is touted as the second-largest crypto exchange in the country and has been supporting an array of cryptocurrencies, the post suggested.

Speaking about the emergence of cryptocurrencies and digital assets in general, the Group Managing Director of Kenanga Investment Bank Berhad, Datuk Chay Wai Leong said,

“The emergence of digital assets including cryptocurrencies have been gaining acceptance globally in the last few years. While we are keen on crypto as an asset class, we are aware of the volatility and the proliferation of unregulated players in the market. We are therefore very pleased to be given the opportunity to invest in one of the three licensed digital asset exchanges in Malaysia.”

Furthermore, he pointed out that Kenanga’s interest wasn’t limited to commonly traded cryptocurrencies like Bitcoin. He suggested that digitalization and the emergence of digital assets were inevitable. With their latest partnership, Kenanga hopes to be at the forefront of this.

The CEO of Tokenize Malaysia, Hong Qi Yu, also addressed the same and said,

“The combined reach, expertise and resources is game-changing and will allow us to scale our presence in Malaysia. Together we will shape the digital asset landscape and build an exciting path forward for investors in the country.”

Huobi Global Launches Its Newest Platform Huobi Labuan In Malaysia

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The crypto platforms have been steering towards jumping into different markets. Exchanges like Huobi and Binance have been stepping into almost every country. Recently the Huobi Global revealed that it was entering into a new market. As the interest and demand for crypto rises, crypto platforms have been working on providing users with an array of services across the globe and Huobi seems to have just jumped on to that bandwagon.

Huobi Steers Towards Malaysia

Huobi Globals seems to be spreading its wings across the world. The platform set out to take over the Malaysian market with the launch of Huobi Labuan. The exchange recently acquired a thumbs up from the Malaysian regulators. The brokerage service license that Huobi garnered will allow it to present the citizens of Malaysia with spot and derivatives trading services. Huobi’s Malaysian wing would be employing an all-in-one solutions provider, Huobi Cloud.

Receiving a license from the financial regulators is a tough nut to crack, especially if one belongs to the crypto-verse. However, Huobi managed to garner a license in September 2020. Even though the platform, Huobi Labuan is starting off with a nine-month trial operation, it has listed a wide range of assets. At present Huobi hoards, Bitcoin [BTC], Bitcoin Cash [BCH], Ethereum [ETH], Ethereum Classic [ETC], EOS as well as HT. The platform revealed that it would welcome more cryptocurrencies into the fold right after the trial period is over.

The press release further said,

“As an independent trading platform licensed under the Huobi brand in Malaysia, Huobi Labuan aims to provide safe and trusted digital transaction brokerage services to local users through the Huobi Cloud technology.”

Malaysian financial authorities have been working towards regulating the crypto market. The country has been probing into several crypto platforms. In October, the Malaysian Securities Commission had rolled out a framework that regulated digital assets.

Similar to Huobi, another prominent crypto exchange, Binance has been exploring the prospects of new markets. The exchange has dipped its toes in several markets across the globe.

Malaysians Still Unclear On Crypto Through Shariah Perspective, says Shariah Advisory Council

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After being associated to the Darknet for many years, cryptocurrencies have finally made their breakthrough on the positive side of several authorities. The globe has an array of diverse religions with their own set of rules. Even though cryptocurrencies have taken off in terms of popularity, some Islamic countries still fall back on the adoption of crypto. Malaysia is one of those lists, and a prominent member of the Shariah Advisory Council sheds light on the same.

Malaysian Authorities Bullish On Crypto

Recently, a Malaysian news portal reported that the Securities Commission Malaysia (SC) Shariah Advisory Council chairman, Dr. Modh Daud Bakar revealed his stance on cryptocurrency. Before indulging in certain ventures, people of the Islam religion need to make sure that it is compliant with the Shariah. The Shariah is a code that governs the lives of Muslims. With the world steering towards the adoption of cryptocurrencies, in July,  the Shariah Advisory Council permitted Muslims to engage in crypto-related activities on registered crypto exchanges. Despite this, Bakar believes that the people in Malaysia still require time to fully grasp crypto from the Shariah viewpoint.

Recently, speaking at the SCxSC Fintech Conference 2020, held virtually, Bakar said,

“It is a medium of exchange, and we cannot stop people to use commodities as medium of exchange. It is as good as buying an e-ticket or commodities in the market.”

He also added that since cryptocurrencies are not viewed as legal tender under the religious law, it can be rather considered a commodity. However, it shouldn’t be backed “ribawi items”.  Bakar pointed out that the adoption of crypto could pave the way to several “interesting areas” in the country. Through this, the crypto could be labeled as an investment asset that would further allow the citizens to trade, buy as well hold crypto assets.

The debate of crypto being accepted and compliant with Islamic laws is still underway. However, several suggest that since cryptocurrencies like Bitcoin is based on proof-of-work and not debt it is considered permissible. Despite this, only three crypto exchanges including Luno Malaysia, Tokenize Malaysia, and Sinegy Technologies are licensed to operate in the country.

Praising the prospects of cryptocurrencies, Bakar added,

“The potential of this currency is as great as it comes with a growing digital economy of the world.”

US Authorities Charge Seven International Hackers Over Cyber Crime Including “Crypto-Jacking”

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Hackers and scammers have begun to see the crypto industry as a valuable stage, as the number of crypto-related violations is clearly on the surge.  A recent bust by the United States has put a stop to an array of hacks.

Hackers Eye Crypto Mining Rewards

The United States Department of Justice recently shared an announcement highlighting charges on seven individuals for carrying out hacks on over 100 companies across the globe. The US officials suggested that the alleged criminals included two businessmen from Malaysia and five residents from China. The statement revealed that the hackers operated under the labels, “APT41,” “Barium,” “Winnti,” “Wicked Panda,” and “Wicked Spider.”

The hackers engaged in several illicit activities like theft of source code, software code signing certificates, customer account data, and valuable business information. Along with this, the alleged criminals went on to employ crypto-jacking schemes where they mined cryptocurrencies via victim computers. Over the years, the crypto mining industry has attracted a lot of interest from individuals, thanks to miner rewards. People stealing electricity or software to aid their mining process has caused a huge ruckus across the globe.

Speaking about the latest incident, the Deputy Attorney General, Jeffrey A. Rosen suggested that the officials were looking into disordering the interventions of the cybercriminals. He added,

“Regrettably, the Chinese communist party has chosen a different path of making China safe for cybercriminals so long as they attack computers outside China and steal intellectual property helpful to China.”

The statement further revealed that the hackers had targeted software development companies, video gaming platforms, computer manufacturers, nonprofit platforms, think-tanks, telecommunication firms along with governments as well as politicians. The hackers not only focused on the United States but also steered into Australia, South Korea, Taiwan, Thailand, Vietnam, Indonesia, Japan, Malaysia, Pakistan, Singapore, Brazil, Chile, Hong Kong, and India.

The five Chinese men charged by the US officials were identified as Tan Dailin, Jiang Lizhi, Qian Chuan, Fu Qiang, and Zhang Haoran.  The Malaysian businessmen were Ling Yang Ching and Wong Ong Hua. All the aforementioned individuals were aged between 32 to 46.