Malaysia’s regulated digital asset exchanges recorded RM17.14 billion, or roughly 4 billion USD, in trading value during 2025, a 23 percent annual increase that positions the country as one of the more open Islamic-finance markets for cryptocurrency, according to a September 16 report from Fitch Ratings.
The rating agency said Malaysia’s regulatory framework and national Shariah treatment have given digital assets a clearer route into its Islamic-finance market than in several other jurisdictions, with the Securities Commission Malaysia having regulated ten digital-asset businesses across exchanges, custodians and offering platforms by the end of the first half of 2026.
The trading figure is independently supported by the Securities Commission’s own 2026 digital-asset market update, which recorded RM17.14 billion in trading value across regulated exchanges in 2025, up from RM13.93 billion a year earlier. Even so, Fitch noted the amount represents only around 2.5 percent of the value traded in Malaysia’s domestic equity market, leaving regulated crypto activity small compared with traditional securities trading.
A three-layer licensing regime
Malaysia’s framework separates regulated digital-asset activity into digital asset exchanges, initial exchange offering platforms and digital-asset custodians. The SC’s official register lists five DAX operators: HATA Digital, Luno Malaysia, MX Global, SINEGY DAX and Kinetic DAX. Kapital DX and Pitch Platforms appear as IEO operators, while CoKeeps, Gambit Custody and Jada Platform are registered custodians.
In May 2026, the SC revised its DAX rules, streamlining the process for licensed exchanges to introduce products while raising requirements covering client-asset protection, governance, financial resources, ownership and management standards. Digital asset exchange operators are scheduled to become members of Malaysia’s Financial Markets Ombudsman Service during 2026, giving retail investors access to a formal dispute-resolution framework. The regulator has also taken administrative action against four unregistered exchanges and worked with technology companies including Google to restrict promotion by unauthorized operators.
Shariah screening sets Malaysia apart
What distinguishes Malaysia from most other markets is the parallel Shariah framework. The SC’s Shariah Advisory Council first considered the treatment of digital assets in 2020, resolving that regulated digital currencies can qualify as mal, or property, under Islamic law. The council ruled that investment and trading in qualifying digital assets on SC-registered exchanges are permissible when they meet its requirements.
Bitcoin, Ether, XRP and Litecoin received Shariah-compliant status at the council’s July 2020 meeting. Bitcoin Cash followed in 2021, with later decisions covering Solana, Cardano, Chainlink, Uniswap, Avalanche, Polkadot and Stellar. The current list identifies Stellar as Shariah-compliant following a December 2024 council meeting. From March 30, 2026, regulated exchanges seeking to offer additional digital currencies as Shariah-compliant must obtain endorsement from the council under revised Islamic capital-market rules.
Participation broadening
The SC’s 2025 annual report attributed the trading increase partly to institutional adoption through exchange-traded funds and clearer regulation in major markets. The number of investors participating in Malaysia’s regulated digital-asset market rose approximately 29 percent from 2024, and 23 digital assets were listed on recognized exchanges at the end of the year. Traditional capital-market firms are also involved, including stockbrokers offering access to digital-asset futures and fund managers providing exposure through investment strategies.
Private capital has followed the licensing regime. Bybit led an 8 million USD Series A investment in regulated Malaysian exchange Hata in April, a round announced as the SC expanded its digital-asset rules. Hata reported RM1.04 billion in transaction volume during 2025. Bybit itself was subsequently removed from Malaysia’s Investor Alert List after engagement with local regulators, although the removal did not convert Bybit into an SC-regulated Malaysian exchange.
Central bank experiments, cautious banks
Bank Negara Malaysia is testing ringgit stablecoins and tokenized deposits through three initiatives this year, adding a monetary-side complement to the SC’s capital-markets framework. Yet Fitch found that bank participation in the crypto market remains largely confined to services provided to regulated operators. Most Islamic banks examined by the agency across major Islamic-finance markets have yet to generate material revenue from direct cryptocurrency trading, brokerage, custody or financing.
Fitch expects Islamic crypto offerings to develop gradually, noting that Shariah views remain divided across jurisdictions. Where Malaysia’s council treats regulated trading as permissible property exchange, scholars in several Gulf states have issued blanket prohibitions, and the interpretive gap shows little sign of closing soon.
The takeaway
Malaysia offers a template for how a majority-Muslim economy can integrate digital assets without choosing between innovation and religious compliance: license the venues, screen the assets, and let institutions opt in. The 23 percent growth in trading value suggests demand is real, if modest relative to equities. The open question is whether other Islamic-finance hubs follow Malaysia’s granular approach or maintain their prohibitions, and whether Malaysian volumes can compound as Shariah-endorsed asset lists expand under the March 2026 rules. For now, the combination of a clear regulator, a national Shariah council and a growing investor base makes Malaysia one of the more watchable mid-sized crypto markets in Asia.
RM17.14 billion in one year and 23 percent growth while neighbors still argue about bans. The SC licensing ten firms by mid 2026 is the part Fitch actually cares about.
RM17.14 billion, up 23% y/y, and the shariah framework is the real story. malaysia quietly built the clearest halal route into crypto anywhere
Ten regulated digital asset businesses by mid-2026 is serious for a market this size. Luno and MX Global sitting on the official SC register gives it real credibility.
the three layer split (DAX, IEO platform, custodian) is cleaner licensing design than most of ASEAN tbh. singapore gets the hype, malaysia got the structure
the DAX IEO custodian split is clean on paper, question is whether the SC can police it with the staff it has. five exchanges for a market this size feels right tho
luno and mx global on the SC register does a lot of quiet legitimacy work. institutions dont have to wonder if the venue is real
the SC register does the work but the real gate is the fatwa lineage. gulf desks ask who signed off, not just is it licensed
clearest halal route is right but it took the fatwa committee years to get there. neighbors cant shortcut that part no matter how much they spend
exactly, indonesia can hire compliance officers, it cannot hire a national fatwa. that lineage is why the gulf desks even pick up the phone
fitch writing a whole report on malaysian crypto volumes means the institutional readers are paying attention now. sleeper market no more
RM17.14 billion is up 23 percent but still just 2.5 pct of their equity market volume. the shariah angle is doing heavy lifting here
the shariah angle doing heavy lifting is the point though. thats volume jakarta and bangkok straight up cannot court
jakarta could copy the framework tomorrow and still not get the gulf money. the national shariah ruling is the moat, compliance can be bought
compliance can be bought but a national ruling cannot be fast tracked, thats years of fatwa committee work. the moat is slower than people think and that is what makes it real
fatwa committee years is exactly why the moat holds. RM17.14b on 2.5 pct of equity volume also means the growth runway is huge if the gulf flows ever arrive
jakarta copying the framework is easy, copying the fatwa credibility is the impossible part. gulf money checks lineage
the 2.5 pct framing cuts both ways tho. that gap is the bull case if the SC keeps issuing licenses, its the ceiling if the gulf money never shows up
2.5 percent of equity market volume is tiny but the growth curve matters. malaysia did the boring licensing work while everyone watched singapore.
boring licensing work while everyone watched singapore is exactly it. we got fatwa credibility instead of a casino avenue, slower but stickier
The Shariah framework matters more than the raw volume. Gulf institutions will not touch anything without that screening, so this is a gateway
ten regulated businesses across exchanges, custodians and platforms by mid 2026. small market but the licensing actually works, unlike some neighbors
^ this. try getting a compliant custody setup in indonesia or thailand as a foreign firm, malaysia is ahead
gulf allocators need that screening before a single dollar moves. if the SC keeps the register clean malaysia becomes the halal on ramp for the whole region
RM13.93b to RM17.14b in a year and still just 2.5 pct of equity volume. small base, but no other ASEAN market has this clear a halal pipeline
23 percent growth on a small base is the honest framing. malaysia built something real, it is just not the volume story yet