The Central Bank of Malaysia has confirmed that cryptocurrency will not become an official means of payment
Date: 2025-03-25 Author: Henry Casey Categories: IN WORLD
Bank Negara Malaysia stated that while tokenization technologies have the potential to transform the financial industry by improving the transparency of payments and expanding payment solutions, cryptocurrencies remain outside the framework of the country's official monetary system. According to the regulator, tokenized deposits can be a useful addition to wholesale versions of the central bank digital currency (CBDC), but cryptocurrencies themselves do not fall into this category.
The Central Bank emphasized that the share of cryptocurrencies in Malaysia's financial turnover is extremely small. According to the latest data, at the end of 2024, less than 1% of bank deposits were withdrawn to cryptocurrency platforms registered in the country, and the total share of digital assets was only 0.4% of the total capitalization of shares on the Bursa Malaysia stock exchange.
However, interest in cryptocurrency among the country's citizens continues to grow. The volume of digital asset trading in 2024 reached $3.06 billion, up 157% from $1.19 billion in 2023. Despite this impressive increase, the regulator remained adamant: cryptocurrency will not be recognized as an official means of payment in Malaysia.
Bank Negara Malaysia also noted that it will continue to monitor the crypto industry, given its rapid development and potential impact on the economy. But at the same time, it emphasized that the regulatory approach will remain balanced and focused on the stability of the financial system.
At the same time, the Malaysian authorities are interested in using other blockchain-related technologies. Thus, in early 2025, an initiative was proposed to use blockchain for digital identification of citizens. This measure is aimed at improving the security of online transactions and combating fraud related to personal data.
Thus, despite the significant growth of crypto activity in the country, Malaysia's central bank is betting on controlled digital solutions, refusing to recognize cryptocurrencies as part of the official financial system.
