CRYPTOCURRENCY adoption in Malaysia has grown phenomenally in recent years among retail investors but institutional adoption is still rather unfamiliar.

MX Global Sdn Bhd CEO Datuk Fadzli Shah (picture) said there are two aspects to look at, namely the institution readiness and whether such institutions can afford the adoption.

He believes Malaysia needs to address challenges such as stringent regulatory approval to make institution adoption more accessible.

He added that in markets such as the US, institutional investors have begun to invest in this asset class.

“Some banks in New York and Wall Street have led in this and for us, it is a matter of time before the larger banks and institutional investors in Malaysia gain confidence to invest as well,” he told the media after a forum in Putrajaya today.

Fadzli added exchanges needed to look at the product offerings to determine which product is suitable and not for the institutional investors.

He stated the Chicago Mercantile Exchange’s bitcoin derivative contract was more suitable for institutional investors and as such is a catalyst for that type of investment.

Binance CEO Changpeng Zhao (CZ) said institutional adoption, especially among financial institutions, may help increase volumes, enable fast transactions, scale faster and build a stronger business model.

“Depending on various types of institutions, the adoption is also an innovation for the company in order to scale faster, through the world of crypto,” he said at the “Crypto Market Trends and Future Opportunities” forum in Putrajaya Marriott Hotel on Thursday.

Regulatory hurdles, he said, are the major challenge in making crypto assets accessible as many institutions are required to be regulated first and are not immediately able to utilise the platform if they are not licensed.

CZ advised retail investors not to over diversify their token investment and to focus on a few coins and understand each of them in-depth.

Fadzli said regulators need to help make crypto mainstream instead of just being seen as a speculative asset, especially among corporations as we move toward a decentralised world.

“It is arguable that the financial and crypto literacy in Malaysia is still relatively low. We are here to promote that, along with a close financial agency and authorities such as Security Commission and Bursa Malaysia,” he said.

He added MX Global’s collaboration with Binance, a global player, paves the way for the digital exchange to scale its business as well as learn from the latter on the crypto aspects which are suitable to adopt and implement in Malaysia.

MX Global sees other regulators as a key enabler to widen the access and market reach rather than a competition.

“We believe the crypto industry will expand through collaboration and not direct competition. The goal is to ensure people can buy crypto with confidence,” Fadzli concluded.  — by NURUL SUHAIDI / pic by TMR FILE