Is crypto legal in Malaysia? Rules & regulation (2026)

Legal framework

Capital Markets and Services Act 2007 (CMSA) read with the Capital Markets and Services (Prescription of Securities) (Digital Currency and Digital Token) Order 2019 and the Securities Commission Malaysia (SC) Guidelines on Digital Assets; Bank Negara Malaysia (BNM) exercises payment-system and monetary oversight in a co-regulatory 'dual model' with the SC.

Status by sub-area

• Stablecoins

  Proposed

  There is no dedicated in-force stablecoin law in Malaysia yet. BNM is piloting ringgit stablecoins and tokenised deposits through its Digital Asset Innovation Hub (DAIH) launched in June 2025, with three named projects onboarded in February 2026 and full regulatory clarity on ringgit stablecoins/tokenised deposits targeted by end-2026.

  Still pending: BNM ringgit stablecoin framework pending; full regulatory clarity targeted end-2026

• Exchanges / VASP

  In force

  Digital Asset Exchanges must be registered as Recognised Market Operators (RMOs) with the SC under the Guidelines on Digital Assets. As of late 2025 six DAX operators are registered, with a revised, tightened framework in force from 20 May 2026.

• Token Offerings

  In force

  Digital token offerings are treated as offerings of securities and must be conducted through an SC-registered Initial Exchange Offering (IEO) platform in accordance with the Guidelines on Digital Assets; issuing without registration is a criminal offence.

• Custody

  In force

  Anyone providing safekeeping, storage or maintenance of digital assets for others must register as a Digital Asset Custodian (DAC) with the SC under s.76A of the CMSA 2007; DACs are specified as 'custodians' under s.121(G) of the CMSA via SC Practice Note No.1/2024.

• DeFi

  None

  Malaysia has no dedicated DeFi framework. Where a decentralised protocol offers or facilitates activity in a prescribed digital asset (dealing, brokering, custody, offering) it falls within the existing CMSA/Guidelines on Digital Assets perimeter, but there are no bespoke DAO, DeFi front-end or protocol-specific rules yet.

  Still pending: No dedicated DeFi/DAO/protocol-specific framework; falls under existing CMSA guidelines

• Tax

  In force

  Malaysia has no general capital-gains tax, so occasional investors' crypto gains are typically untaxed, but income-nature gains (trading, mining, business use) are subject to income tax under the Income Tax Act 1967. LHDN issued formal Guidelines on the Tax Treatment of Digital Currency Transactions setting out the badges-of-trade approach, FIFO valuation and record-keeping.

Key points: crypto & digital assets in Malaysia

1. 01Securities status of digital assets

   The Capital Markets and Services (Prescription of Securities) (Digital Currency and Digital Token) Order 2019 (in force 15 January 2019) prescribes qualifying digital currencies and digital tokens as 'securities' under the CMSA 2007, meaning any offering, dealing, trading or custody activity requires SC authorisation.

   sc.com.my sc.com.my

2. 02Dual regulator model

   The SC regulates capital-market conduct (exchanges, offerings, custody, brokers), while Bank Negara Malaysia (BNM) regulates payments and monetary matters; BNM has repeatedly stated that cryptocurrencies are not legal tender and only the ringgit is.

   bnm.gov.my panewslab.com

3. 03Enhanced DAX framework – May 2026

   Revised SC Guidelines on Digital Assets took effect 20 May 2026, liberalising the token listing framework, tightening capital, shareholding and fit-and-proper requirements for licensed DAX operators, and strengthening client-asset safeguarding; all DAX operators must become members of the Financial Markets Ombudsman Service in 2026.

   businesstoday.com.my fintechnews.my

4. 04Digital asset broking clarified – Jan 2026

   On 30 January 2026 the SC clarified that Capital Markets Services Licence (CMSL) holders may offer broking services in prescribed digital assets on a cash-upfront basis (no margin/lending), sourcing only from SC-registered DAXs or FATF-compliant offshore venues, with client asset segregation via a registered DAC.

   bakermckenzie.com globalcompliancenews.com

5. 05Enforcement against unlicensed operators

   The SC has taken administrative action against unregistered digital asset exchanges and, from 14 April 2026, worked with technology platforms (including Google) to block advertising by unlicensed DAX operators to Malaysian users.

   theedgemalaysia.com businesstoday.com.my

6. 06Ringgit stablecoin pilots via BNM DAIH

   On 11 February 2026 BNM announced three initiatives onboarded under its Digital Asset Innovation Hub to test ringgit stablecoins and tokenised deposits (Standard Chartered/Capital A stablecoin for B2B settlement; Maybank and CIMB tokenised deposits), with regulatory clarity on ringgit stablecoins targeted for end-2026.

   theasianbanker.com theedgemalaysia.com theblock.co

Timeline of decisions

1. 1 May 2026Guidance
   SC overhauls Recognized Markets Guidelines for digital asset exchanges

   The Securities Commission Malaysia issued major revisions to its Guidelines on Recognized Markets, liberalising asset listings while tightening cold-storage (min. 90% offline), client-asset segregation and operator capital requirements. It finalised the enhancements proposed in the 2025 public consultation.

   The Vibes

2. 30 Jan 2026Guidance
   SC clarifies regulatory framework for digital asset broking

   The SC issued a Practice Note setting requirements for digital asset broking: assets must have SC concurrence and be sourced from a registered DAX, trades must be cash-upfront with no margin/lending, and client assets must be segregated and custodied. It opened a regulated broker channel beyond direct DAX trading.

   Baker McKenzie

3. 30 Jun 2025Guidance · official
   SC consults on enhancing the Digital Asset Exchange framework

   The SC opened public consultation (30 June-11 Aug 2025) on liberalising token listings by removing case-by-case SC concurrence, alongside stronger custody, segregation and capital rules. The move responded to record 2024 DAX trading of RM13.9 billion.

   Securities Commission Malaysia

4. 19 Aug 2024Guidance · official
   Revised Guidelines on Digital Assets (R3-2024)

   The SC issued a revised edition of its Guidelines on Digital Assets, updating rules for Initial Exchange Offerings (IEO) and Digital Asset Custodians. It refined the fundraising and custody regime built on the original 2020 guidelines.

   Securities Commission Malaysia

5. 30 Jul 2021Enforcement · official
   SC takes enforcement action against Binance

   The SC publicly reprimanded Binance and CEO Zhao Changpeng for operating an unregistered Digital Asset Exchange in breach of the Capital Markets and Services Act 2007, ordering its websites and apps disabled and Malaysian users to withdraw funds. It was the regulator's most prominent crypto enforcement action.

   Securities Commission Malaysia

6. 15 Jan 2020Guidance · official
   SC announces Initial Exchange Offering (IEO) framework

   The SC unveiled plans to allow companies to raise funds by issuing digital tokens through SC-registered IEO platforms, releasing draft guidelines. It signalled Malaysia's intent to regulate, rather than ban, token fundraising.

   Securities Commission Malaysia

7. 23 Oct 2019Decision
   Luno receives full DAX operator approval

   The SC granted Luno Malaysia full approval to operate as a Recognized Market Operator (Digital Asset Exchange), making it the first fully approved crypto exchange in the country. It marked the first live, fully compliant DAX under the new regime.

   The Malaysian Reserve

8. 4 Jun 2019Decision · official
   SC registers three digital asset exchanges

   The SC conditionally registered Luno, SINEGY and Tokenize as Recognized Market Operators for digital asset exchanges, giving them up to nine months to fully comply. It established Malaysia's first set of regulated crypto trading venues.

   Securities Commission Malaysia

9. 27 Feb 2018Guidance · official
   BNM imposes AML/CFT rules on digital currency exchanges

   Bank Negara Malaysia issued its AML/CFT, Digital Currencies (Sector 6) policy, designating crypto exchanges as reporting institutions under the AMLA 2001 with KYC, due-diligence and reporting duties. It brought crypto businesses into the anti-money-laundering perimeter.

   Bank Negara Malaysia

10. 3 Jan 2014Guidance · official
    BNM declares Bitcoin not legal tender

    Bank Negara Malaysia issued its first official statement that Bitcoin is not recognised as legal tender and is not regulated by the central bank, warning the public of associated risks. It was Malaysia's earliest formal regulatory position on cryptocurrency.

    Bank Negara Malaysia

Sources

1. 1.sc.com.my/regulation/guidelines/digital-assets
2. 2.sc.com.my/resources/media/media-release/guidelines-on-digital-assets-come-into-
3. 3.sc.com.my/regulation/guidelines/recognizedmarkets/list-of-registered-digital-as
4. 4.sc.com.my/regulation/technical-notes-practice-notes-and-circulars/practice-note
5. 5.bnm.gov.my/-/statement-on-bitcoin
6. 6.hasil.gov.my/media/ittdkpgv/guidelines-tax-treatment-on-digital-currency-transacti
7. 7.bakermckenzie.com/en/insight/publications/2026/02/malaysia-securities-commission-clarif
8. 8.businesstoday.com.my/2026/05/20/sc-tightens-digital-asset-exchange-rules-speeds-up-product
9. 9.theedgemalaysia.com/node/804271
10. 10.theedgemalaysia.com/node/792560
11. 11.theasianbanker.com/press-releases/bank-negara-malaysia-onboards-ringgit-stablecoin-and-t
12. 12.panewslab.com/en/articles/lc23yr39f56e
13. 13.fintechnews.my/58654/blockchain/malaysia-digital-asset-guidelines/
14. 14.globalcompliancenews.com/2026/02/13/https-www-bakermckenzie-com-en-insight-publications-2026-0
15. 15.theblock.co/post/389370/malaysias-central-bank-stablecoin-initiatives