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Malaysia welcomes blockchain advancement

In January 2019, Malaysia’s Minister of Finance announced harsh regulations against unauthorized ICOs and the exchange of digital goods that could result in a 10-year jail term or a US$2.4 million fine.

The order recognized digital currencies and tokens as securities by the Securities Commission Malaysia. This was primarily seen as a negative move against the crypto and blockchain (the underlying technology fuelling cryptocurrencies) industries.

Later, in June 2019, the Securities Commission announced that it had conditionally approved three cryptocurrency exchanges.

This suggests that the Southeast Asian nation is increasing its openness to the technology.

Keeping pace with global innovation

Malaysia’s willingness to adopt the tech was evidenced at a recent event in Putrajaya, Malaysia, officiated by the Ministry of Entrepreneur Development (MED). The minister’s attendance, in particular, signals an early sign of governmental support and commitment towards recognizing blockchain businesses and technology.

In his official address, the minister pointed out the importance of moving as fast as was possible to keep up with the global innovation scene and become a top investment destination. MED aims to create and develop innovation-driven entrepreneurs adopting frameworks that would result in exponential growth and would incorporate the latest 4IR technologies such as AI, IoT, big data, and blockchain.

This was in line with Dasar Keusahawanan Nasional (DKN) 2030, a government initiative to develop core competencies and upskill the workforce against a landscape of growing digital transformation.

Creating new growth sectors

Currently working on a plan of action that would pioneer new growth sectors via strategic investments, the government’s focus would be on industries such as automotive, aerospace, fintech, big data analytics, and tech-driven agriculture, amongst others. These were necessary building blocks pivotal to realizing the DKN 2030 objectives.

Ultimately, this will catalyse the creation of more innovation-driven products and services that are market-oriented.

In this area, blockchain technology plays an integral role in the fintech and agricultural industries. The minister welcomed a strong push by the private sector which the ministry aims to facilitate as fast as possible.

Blockchain as a catalyst

There is a pressing need to overhaul the government’s bureaucratic processes and go paperless. The adoption of blockchain enabling this, following in the footsteps of the Emirates and Indonesia.

According to MBA statistics, once digital strategies such as blockchain were in place, projected growth of 15-20% in GDP could be expected. MaGIC, an innovation centre under MED and Malaysia Blockchain Association (MBA) were both commended for working as catalysts driving blockchain technology forward, engaging with both government and public.

Supporting blockchain entrepreneurship

The CEO of MaGIC noted that blockchain is important technology; its usage is widespread, and the Malaysian government is trying to develop competencies in this locally.

The recent MoU on blockchain tech between MaGIC and MBA, wherein the two will collaborate to establish a Blockchain Research Lab, will help with this goal.

Malaysia’s blockchain landscape has improved with support from the Ministry of Entrepreneur Development. MBA has a role to play in educating Malaysian society on how important blockchain technology is to the ecosystem as well as connecting the two different worlds of e-commerce and blockchain.

Malaysia’s digital transformation will land global investors in Malaysia, putting the spotlight on the large number of great projects that the region has.

To capitalize on innovations, citizens will need to be brave entrepreneurs, not followers. Malaysia has been identified as a top destination for investment, one of the most successful nations for start-ups. By using this as a starting point, local entrepreneurs can prove they can do more in terms of adopting blockchain.

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