Malaysia has developed rules for IEO and ICO

by in Cryptocurrency News

Malaysia ICO IEO

The Malaysian Securities Commission (SC) has developed rules for organizers of Initial Coin Offers (ICOs) and Initial Exchange Offers (IEOs).

Startups are allowed to distribute tokens through venture capitalists and financial institutions without selling shares and without using debt instruments. Both institutional and retail investors can participate in the campaigns.

The maximum amount allowed to be attracted through an ICO is 100 million Malaysian ringgit (about $24.5 million). After the completion of fees, the regulator will monitor the spending of collected funds.

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The organizers of IEO platforms should independently register with the department and conduct the necessary checks of the token issuer to ensure its integrity, as well as understand the capabilities and characteristics of the token offered by it.

The new rules will come into force in the second half of 2020.

In January 2019, a law on cryptocurrencies and digital tokens came into force in Malaysia, which in fact equated them with securities. It also provides fines in the equivalent of $2.5 million and imprisonment of up to 10 years for organizers of unregistered ICOs and cryptocurrency exchanges.

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In June, the financial regulator registered the crypto exchanges Luno Malaysia, Sinegy Technologies and Tokenize Technology.