21st March 2022 - 2 min read
The Ministry of Communications and Multimedia has proposed the adoption of digital currencies, such as cryptocurrencies, as legal tender in Malaysia.
The proposal is aimed at assisting the younger generation who actively use digital currencies, especially on non-fungible token (NFT) trading platforms. Deputy Communications and Multimedia Minister Datuk Zahidi Zainul Abidin, who presented the proposal, said that the ministry will explore ways to boost the participation of youths in digital currencies, stating that it is the future of finance.
“All of these are under the purview of Bank Negara Malaysia and the Securities Commission Malaysia.
“We hope the government will allow and legalise this so that we can increase the youth’s uptake of cryptocurrencies,” Datuk Zahidi added.
To clarify, legal tender is defined as a means recognised by law to pay private or public debt, or meet financial obligations, such as taxes, contracts, and legal fines or damages. The Currency Act 2020 (Act 827) states that only currency notes and coins issued by Bank Negara Malaysia shall be legal tender in the country.
Early this month, Deputy Finance Minister II Yamani Hafez Musa said that Malaysia does not recognise cryptocurrencies as legal tender as they do not portray the characteristics of universal money. “In general, digital assets are not a store of value and a good medium of exchange. This is due to the state of digital assets which are exposed to volatility as a result of speculative investments,” he added.
Yamani highlighted that cryptocurrencies or digital assets are also not a payment instrument regulated by Bank Negara Malaysia.
(Source: The Edge Markets)
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