What are the key compliance measures for digital asset issuers?

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Key Compliance Measures for Digital Asset Issuers Mandated by the Securities Commission

Digital asset issuers in Malaysia will be subject to a comprehensive set of compliance measures, encompassing anti-money laundering, counter-terrorism financing, cybersecurity, and business continuity protocols. These requirements are outlined in the latest guidelines issued by the Securities Commission (SC) to regulate the burgeoning digital asset landscape. The introduction of these guidelines signifies a move towards formalising the oversight of digital asset activities, aligning them with established financial market regulations.
Anti-Money Laundering and Counter-Terrorism Financing Protocols

A primary requirement for digital asset issuers involves the implementation of robust anti-money laundering (AML) and counter-terrorism financing (CTF) rules. These measures are designed to prevent the illicit use of digital assets for criminal activities and to ensure transparency in transactions. The SC's directive mandates that issuers establish and maintain systems and controls that align with national and international AML/CTF standards.
Cybersecurity and Business Continuity Standards

Issuers of digital assets must also put in place stringent cybersecurity measures to safeguard digital assets and sensitive information from cyber threats. Alongside these security protocols, business continuity plans are mandated to ensure operational resilience and minimize disruptions in the event of unforeseen circumstances. These dual requirements aim to protect both the integrity of the digital asset ecosystem and the assets of investors.
Fit and Properness, Disclosure, and Trading Rules

The SC's guidelines further establish clear criteria for determining the "fit and properness" of issuers and exchange operators, ensuring that only credible entities can participate in the market. Additionally, comprehensive disclosure standards will be enforced, requiring issuers to provide clear and accurate information to potential investors. Best practices in price discovery and defined trading rules will also be instituted to promote fair and orderly markets, alongside explicit rules for client asset protection. The offering of digital assets and associated activities will necessitate prior authorisation from the SC and adherence to all relevant securities laws and regulations.

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What are the key compliance measures for digital asset issuers?

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