Malaysia's Deputy Finance Minister: Crypto Not Suitable as Means of Payment or Store of Value

Malaysias deputy finance minister says that cryptocurrencies, such as bitcoin and ethereum, are not suitable as a means of payment or a store of value. While digital assets are not recognized as legal tender in Malaysia, the finance ministry official said that they are an asset class that can be invested in.

Reports have it that Malaysias deputy finance minister Mohd Shahar Abdullah is not in support of the idea of adopting crypto as a payment method. A few days ago, the deputy communications minister, Datuk Zahidi Zainul Abidin, proposed the adoption of crypto as a means of payment.

Zainul Abidin called for the legalization of some use cases of crypto and NFTs, stressing that such measures would remarkably support youth as there is massive growth of crypto and NFTs among them.

According to a report by Bloomberg, Mohd Shahar Abdullah was at a parliamentary meeting on March 24, noting that crypto is unsuitable for use as a payment instrument because of a variety of limitations. He mentioned risks such as volatility and possible cyber threats.

He said the focus will remain on prospective development of CBDC as against the adoption of crypto for payments. Malaysia's central bank is involved in an active assessment of CBDC's potential as the payment space and technology continues to grow.

Although Malaysian financial regulators are unwilling to adopt crypto as a means of payment, they are yet to restrict crypto trading

Meanwhile, Malaysia has been cracking down on illegal cryptocurrency mining activities. In December, the Malaysian police shut down a crypto mining operation and seized 1,720 bitcoin mining machines in an electricity theft crackdown. In July last year, the authority destroyed over 1,000 bitcoin mining machines with a steamroller..