With the Malaysian government allocating a generous RM5 billion in its Annual Budget 2019 to drive the local Industry 4.0 forward, it comes as no surprise that the contribution of the local digital economy to the country’s national gross domestic product (GDP) is projected to rise from 18% as of January 2019 to 22% by 2022. The particular domain in the local digital economy to watch out for is that of financial technology (FinTech) as the recent advancements made by Malaysia in this space has led to Ernst & Young (EY) dubbing the country the “emerging fintech hub in Asia” in its ASEAN FinTech Census 2018. As blockchain is highly dependent on the efficacy of the local digital economy to play its role in providing a macro-supporting framework for the development of the technology, it is fair to say that the prospects for blockchain adoption in Malaysia are brimming with possibilities. Given its burgeoning FinTech landscape, Malaysia certainly has ample room to accommodate the technology.
In the cryptocurrency domain, Malaysian regulators have taken the initiative in providing legal certainty through the enactment of the Capital Markets and Services Order 2019, which came into effect in January this year. Through its prescription of certain categories of digital tokens and digital currencies as securities for the purposes of the Capital Markets and Services Act (CMSA), the 2019 Order leveraged Malaysia’s tried and tested existing securities regulatory framework, while also allowing the local crypto industry room for development by excluding cryptocurrencies that lacked security-like features and functionalities. Suffice to say, the Malaysian regulators may have accomplished the daunting feat of walking the fine line between imposing regulatory oversight over the local crypto industry and affording enough space for innovation so as not to stifle growth.
Through its in-depth and comprehensive coverage of Malaysia’s blockchain and crypto industry, the Malaysian Blockchain Landscape Report aims to serve as a handy reference for anyone interested in learning more about the industry, exploring its opportunities, and identifying the many white spaces in the market amid robust infrastructure and policy support for blockchain, as well as keen crypto interest in the population.
With that in mind, Asia Blockchain Review (ABR) presents five features of the Malaysian Blockchain Landscape Report that make it an indispensable resource for investors looking for new frontiers in blockchain and cryptocurrency.
1.Ride on the PESTLE Helicopter to Get a Bird’s Eye View of the Landscape
Zooming-in on macro-environmental factors under the framework of a PESTLE (Political, Economic, Social, Technological, Legal and Environmental) analysis, the Malaysian Report explores the impact of the (1) rapid expansion of the local digital economy and in particular its booming Fintech industry; (2) prevalent use of mobile platforms by Malaysians for e-commerce, mobile banking and ride hailing purposes; and (3) the crypto regulatory framework in Malaysia, including the salient provisions of the 2019 Order as well as the eligibility and compliance obligations of digital asset exchange (DAX) operators in the country.
2.Identifying the Parameters of the Landscape Using SWOT Binoculars
Building on the findings of the PESTLE analysis, the Malaysian Report sets out an evaluation of the key strengths and pain points of the local blockchain and crypto industry through a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis of the macro-environmental factors that have a material impact on local market conditions. Some of the Opportunities (O) identified in Malaysia include the wide use of e-commerce among the local population, which provides a ready platform for crypto payment tokens.
3. A Lesson in Malaysian Blockchain History
By highlighting notable observations and key milestones, the Malaysian Report takes an overarching view of the major developments in the local blockchain and crypto space to give readers a contextual understanding of the two domains. Notable developments include the publication of a groundbreaking report on the blockchain regulatory framework by Malaysia’s oldest university i.e. University of Malaya (UM), the development by the national stock exchange Bursa Malaysia of a blockchain-based, proof-of-concept platform for securities borrowing and lending (SBL) tradings and the Malaysian government’s plans to build the Malacca Straits City, which will function as a tourist blockchain city.
4.Getting Acquainted with the Players
The Malaysian Report includes a list of major and notable local market players, including Everus, GoByte, HelloGold and DACSEE. The corporate profiles of these players set out their core competencies and funding statuses to allow readers to gauge the degree of market saturation and its distribution patterns.
5.Understand the Situation on the Ground
In its final section, the Malaysian Report sets out the findings of interviews and surveys of local blockchain as well as crypto startups and organizations, representing a wide cross-section of the industry. These findings are synthesized into a market analysis of current observations and future trends, letting investors navigate through the local market and make informed decisions.
Published by ABR in its efforts to build a technological foundation for blockchain in the region, the Malaysian Report is part of a series of first-of-its-kind Southeast Asian blockchain landscape reports that serve as essential industry resources for anyone looking to move on the myriad opportunities in the regional blockchain and crypto space.
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