KUALA LUMPUR: The Securities Commission Malaysia (SC) will approach the non-fungible token (NFT) issuance on a case-by-case basis, subject to the nature of the token and the NFT projects, as well as the activities carried out at the NFT market place.
Chairman Datuk Syed Zaid Albar said based on the commission’s observation on the NFT market place in Malaysia at the moment, the underlying assets of most NFT are non-security products.
“The popular applications of NFT, from what we see, are for collectable items such as music, sports, and others. Notably also, there are NFT projects that sell their NFT before the completion of the projects.
“And also perhaps (it’s) pertinent to act, that globally, the International Organisation of Securities Commissions (IOSCO) is also closely monitoring the development in this area,” he told a virtual media briefing on the release of the SC Annual Report 2021 today.
NFTs are cryptographic assets on a blockchain with unique identification codes and metadata that distinguish them from each other.
Unlike cryptocurrencies, NFTs cannot be traded or exchanged at equivalency, which is different from fungible tokens like cryptocurrencies which are identical to each other and, therefore, can serve as a medium for commercial transactions.
According to Syed Zaid, the recent IOSCO Decentralised Finance Report, published in March 2022, mentioned that NFT may be a part of a newly established taskforce to look into the prioritisation at a later stage.
Meanwhile, SC managing director Foo Lee Mei said, from the legal perspective, like any other capital market products, if in the future the NFT meet the commission’s digital assets prescription order, and/or any of the NFT players engaged in the capital market regulator’s activities, then it may come under the SC’s purview. - Bernama
