SC open to blockchain technology review, sees potential usage

Securities Commission chairman Tan Sri Ranjit Ajit Singh said blockchain, otherwise known as distributed ledger technology, has potential usage. — File picture by Choo Choy May
Securities Commission chairman Tan Sri Ranjit Ajit Singh said blockchain, otherwise known as distributed ledger technology, has potential usage. — File picture by Choo Choy May

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KUALA LUMPUR, March 15 — The Securities Commission Malaysia (SC) is open on the need to review blockchain technology and sees a lot of its potential usage in the capital market and solutions.

Chairman Tan Sri Ranjit Ajit Singh said there had been a lot of debate surrounding cryptocurrencies and initial coin offerings (ICOs), and one consistent thing was that the underlying technology, namely blockchain, otherwise known as distributed ledger technology, has potential usage.

“The SC is currently doing a blockchain pilot project in the unlisted and over the counter market space to see whether it could be applied.

“And (it) is open to review the application and will publish its findings as an industry blueprint within this year,” he told a media briefing on its annual report 2017.

Blockchain is an open, distributed ledger technology that can record transactions between two parties efficiently and in a verifiable and permanent way.

On ICOs, Ranjit said the SC had been engaged by several companies which were contemplating to conduct ICOs, but emphasised that the engagements were nothing more than talks and discussions.

He said it was important for the players to seek advice, as raising funds through ICOs could potentially be in breach of securities laws and therefore, they must ask for clarification from the regulator.

“That is the position that we have taken on the matter, and 12 companies have been and are currently engaging with us,” he said.

Ranjit said the securities law were very clear, hence, if the SC, through its own review of their white papers, found that the potential ICOs could be in breach of the laws, appropriate action would be taken, depending on the nature of breach.

In fact, the SC has taken action against one of the ICOs, namely Singapore’s CopyCash, whose launch which was slated for February was blocked by the regulator, he added.

The SC will continue to monitor the evolving landscape, he said, adding that it believed that digital assets have a place in the new frontier of the financial market, but investors certainly needed to exercise caution. — Bernama

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