Malaysia inches forward with new cryptocurrency policy

Bank Negara Malaysia (BNM) has just issued the Anti-Money Laundering and Counter Financing of Terrorism Policy for Digital Currencies (Sector 6). As the title implies, it’s basically just a guideline that warns of the dangers of cryptocurrencies being used in illegal ways.

The policy aims to ensure that effective measures are in place against money laundering and terrorism financing risks associated with the use of digital currencies and to increase the transparency of digital currency activities in Malaysia.

Last year, BNM received feedback from representatives of existing digital currency exchangers, industry associations, law firms, financial institutions, academia as well as interested individuals. Feedback received from respondents mainly focused on the obligations imposed on digital currency exchangers, including businesses providing intermediary services involving digital currencies.

By repeating what has all along been its standard responses, the bank has not made any leeway towards real progress in acceptance or rejection of this means of currency.

“The public is reminded that digital currencies are not legal tender in Malaysia. Accordingly, digital currency businesses are not covered by prudential and market conduct standards or arrangements that are applicable to financial institutions regulated by the Bank. Members of the public are advised to carefully evaluate the risks associated with dealings in digital currencies.

The Bank wishes to reiterate that the invocation of reporting obligations on digital currency exchange business does not in any way connote the authorisation, licensing, endorsement or validation by the Bank of any entities involved in the provision of digital currency exchange services. Where relevant, these matters have been further elaborated in the policy document.”

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