The Securities Commission Malaysia (‘SC’) announced on 23 March 2022 that it has registered two Initial Exchange Offering (‘IEO’) operators, namely Kapital DX Sdn Bhd and Pitch Platforms Sdn Bhd, under the SC’s Guidelines on Digital Assets (‘Guidelines’).
 
The Guidelines came into effect on 28 October 2020 and provide for the regulation of initial offering of digital tokens, and the registration and regulation of IEO operators and digital asset custodians.
 
An IEO operator is an electronic platform operator registered under the Guidelines to operate an electronic platform which hosts an initial exchange offering of digital tokens by an issuer of such tokens.
 
The SC has stated in its announcement that the two IEO operators will be given up to nine months to comply with all regulatory requirements before commencing operations, including putting in place a robust and effective Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) process to mitigate Money Laundering and Terrorism Financing (ML/TF) risks.
 
With two IEO operators given the greenlight by the SC to proceed (subject to compliance with all regulatory requirements), we now await the first initial exchange offering of digital tokens to be launched in Malaysia.
 
To read our write-up on the Guidelines, please click here.
 
Alert by Lee Ai Hsian (Partner) of the Fintech Practice Group of Skrine.