Malaysia’s Cryptocurrency Trading Reaches All-Time High of $2.9 Billion Amid Regulatory Reform Proposals for DAX

Malaysia’s Securities Commission (SC) has suggested extensive modifications to its digital asset exchange (DAX) regulatory framework. This initiative follows a significant increase in digital asset trading, which reached a record RM13.9 billion ($2.9 billion) in 2024, more than double the volume seen in 2023.

As outlined in the consultation document published by the commission, the proposed revisions aim to expedite the time-to-market for new tokens while improving governance, investor protection, and platform resilience.

Public Consultation: Enhancing the Digital Asset Exchange (DAX) Framework
Consultation is open 30 June – 11 August 2025.
Full media release: https://t.co/uQPeQadh7B
Consultation Paper: https://t.co/AGXjbEamRW
Questions? Email us at [email protected] pic.twitter.com/FyQiY5UWFe

— SC Malaysia (@SecComMalaysia) June 30, 2025

Significantly, Malaysia’s digital asset market has expanded considerably since the introduction of the DAX framework in 2019. The increase in trading volume in 2024 was attributed to rising interest from both retail investors and institutional players.

The SC also pointed out the growing participation of traditional capital market intermediaries, who are gaining exposure to crypto assets through direct investments and fund-based avenues.

Malaysia Proposes Faster Listings with Eligibility Criteria Among Other Reforms

Under the suggested reforms, specific tokens may be listed on regulated DAX platforms without prior approval from the SC. This adjustment would only pertain to digital assets that fulfill established eligibility criteria.

The regulator aims to minimize regulatory delays and enable exchanges to react more swiftly to market demands. Concurrently, DAX operators would assume greater responsibility for ensuring that listed assets adhere to legal and risk standards.

The SC also intends to implement enhanced governance requirements. DAX operators would be mandated to separate client assets from their own operational funds. This initiative aims to prevent misuse and strengthen trust among users.

Additionally, the SC noted that operational control standards would be elevated to address the distinct risks associated with trading digital assets. This includes more rigorous oversight of internal processes and improved risk management frameworks.

Another significant element of the proposal is the increase in financial thresholds for licensed DAX operators. The SC indicated that these modifications are designed to bolster the operational and financial resilience of exchanges.

Stricter capital requirements would help ensure that platforms can endure market fluctuations and meet obligations to clients. The regulator believes this will enhance investor confidence and contribute to a more stable trading atmosphere.

Malaysia Ramps Up Crypto Reform Efforts Amid Surge in Mining-Linked Power Theft and Regulatory Gaps

The consultation period is set from June 30 to August 11, 2025, and notably, these proposed modifications are part of the SC’s broader strategy to maintain Malaysia’s digital asset ecosystem as competitive and secure.

This consultation coincides with wider government initiatives to position Malaysia at the forefront of responsible fintech innovation. In March 2025, Bank Negara Malaysia (BNM) announced plans to investigate asset tokenization and digital asset technologies.

Malaysia’s central bank will explore asset tokenization and digital assets, collaborating with the private sector on potential use cases for tokenized deposits and CBDCs.#BankNegaraMalaysia #CBDChttps://t.co/FAnsrg2yY6

— Cryptonews.com (@cryptonews) March 24, 2025

This will emphasize collaboration with the private sector and explore use cases such as tokenized deposits and CBDCs, as detailed in its 2022-2026 financial sector blueprint.

Despite its progressive outlook, the central bank warned that cryptocurrencies are still not recognized as legal tender due to their associated risks. This cautious stance was reflected in the SC’s recent enforcement actions, which targeted unlicensed foreign crypto exchanges like Bybit and Huobi Global for operating without registration.

Malaysia has directed @Bybit_Official to disable its website and mobile applications in the country, citing enforcement actions against the exchange.#Bybit #Malaysiahttps://t.co/RfuIef4vLE

— Cryptonews.com (@cryptonews) December 30, 2024

Ongoing crypto regulations in Malaysia are understandable given the rise in crypto scams and theft. Tenaga Nasional Berhad (TNB) reported a 300% increase in power theft associated with illegal crypto mining.

There were 610 detected cases of power thefts in 2018, linked to illegal crypto mining, which surged to 2,397 in 2024, Malaysia TNB noted.#MalaysiaCryptoMining #BitcoinMining #ElectricityConsumptionhttps://t.co/Xmnl4pXXhx

— Cryptonews.com (@cryptonews) May 12, 2025

This number increased from 610 cases in 2018 to 2,397 in 2024, with approximately 1,699 crypto-related complaints received between 2020 and 2024. This occurs in the absence of any regulatory body overseeing mining activities.

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