Malaysia’s Central Bank Signals Year-End Bitcoin Ban

Malaysia central bank Governor is taking bitcoin cues from China. His glib statements are attracting widespread regional attention, as Southeast Asia’s 4th largest economy attempts to reconcile notorious financial conservatism with radical financial change.

Also read: Malaysian Central Bank Focuses on Adapting Fintech Regulation

Malaysia, Regional Fiscal Powerhouse

Asian Institute of Finance (AIF) hosted its 9th International Conference on Financial Crime and Terrorism Financing (ICFTF) 2017 in Kuala Lumpur, Malaysia.

AIF is the promotional arm for both the country’s central bank, Bank Negara Malaysia (BNM), and its regulatory body, Suruhanjaya Sekuriti Securities Commission Maylasia.

ICFTF’s keynote was given by Tan Sri Muhammad bin Ibrahim, BNM Governor since 2016.

Fifty years at an average 6.5 percent growth rate will do that, as will outperforming Australia and France …

The conference billed itself as exploring “current and new trends in financial crime and the next generation of detection and technological capabilities expected of anti-financial crime professionals to meet global and regulatory expectations.”

In addition to BNM’s Mr. Ibrahim, this year’s ICFTF listed talks by global law enforcement outfits such as the US Department of Justice’s East Asia and Pacific Regional Legal Advisor for Cybercrime. In half-a-dozen plenary sessions speakers also included major banks, international businesses, and service providers.

Such an august lineup is proof enough Malaysia has arrived on the world financial stage.

Fifty years at an average 6.5 percent growth rate will do that, as well as economically outperforming Australia and France (World Economic Forum’s recent Competitive Rankings).

Old Wine, New Bottles

As a result, there’s probably little wonder the country views a decentralized, unregulated currency as perhaps nothing more than a potential wrench thrown at its half century boom.

Previous official dispatches on bitcoin have been dismissive, terse.

Prior to Governor Ibrahim’s tenure, BNM issued notice in 2014, “The Bitcoin is not recognised as legal tender in Malaysia. The Central Bank does not regulate the operations of Bitcoin. The public is therefore advised to be cautious of the risks associated with the usage of such digital currency.”

Fair enough. Be careful. This isn’t something we’re going to endorse nor protect you from, seemed to be the country’s official stance.

Just Wait

Mr. Ibrahim finished his formal ICFTF remarks and soon addressed reporters.

“This (ban on cryptocurrencies) is something that we will decide on by the end of the year,” he said.

A Malaysian cryptocurrency acceptance would mean “collecting the data, and also making sure whatever they do will be (made) transparent,” The Malaysian Insight quoted him as saying.

The tabloid reiterated how “guidelines would also address the risks associated with money laundering and terrorism financing in Malaysia,” by now an all-too familiar trope.

“Just wait,” he scolded. “Now is only October. In less than three months, we will give you the details.”

Bitcoin enthusiasts are waiting.

What do you think? Will Malaysian government bans have any negative impact on bitcoin? Tell us in the comments.

Photos courtesy of: ZyZiXuN.net, Saw Siow Feng

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