Malaysia’s central bank eyes asset tokenisation, says crypto represent less than 1% of bank deposits

In its annual report, the Central Bank of Malaysia described the plans to support the tokenization of assets and explore the technologies of digital assets without the intention of recognizing the crypto as a legal offer.

MalaysiaThe Central Bank of the Negara Malaysia bank has deployed its 2024 annual report, highlighting the growing recognition of tokenization For its potential for stimulating the efficiency of the financial system while showing caution around the risks of cryptocurrencies.

In a March 24 research reportThe central bank said that in Malaysia, the cryptography market “remains active but small compared to the overall size of the national financial market”.

“Based on the cumulative outputs of net deposit of banks for the exchange of numeric assets registered national, the cryptocurrency represent less than 1% of the total of the banking system deposits at the end of 2024 and approximately 0.4% of the market capitalization of the securities listed on Bursa Malaysia.”

Banque Negara Malaysia

However, the Malaysian cryptography market has been active, known as the Central Bank, adding that in 2024, the total trading volume of crypto in the country increased to around $ 3.06 billion, compared to $ 1.19 billion in 2023, reflecting growth of around 157%.

New opportunities

The Central Bank has also described its continuous emphasis on exploring digital asset technologies, emphasizing support for asset tokenization and the development of a central bank digital currency. In the report, the regulator noted that the tokenization of assets in the regulated financial sector “creates new opportunities by allowing programmability, composibility and atomicity”.

“Among other things, BNM sees the potential for token deposits to serve a credible chain payment asset to complete the CBDC wholesale. Like traditional commercial bank deposits, tokenized deposits issued by regulated financial institutions are a complaint against a transmitting bank. ”

Banque Negara Malaysia

While BNM recognizes the potential of the tokenization to stimulate the effectiveness of the financial system, he clearly indicated that cryptocurrencies would not be recognized as a legal obligation. Instead, the central bank plans to keep an eye on the cryptographic space, which, according to him, will continue to grow in 2025.