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Malaysian Central Bank: Cryptocurrency Belongs To The People, They Must Regulate It Themselves

Malaysian Central Bank: Cryptocurrency Belongs To The People, They Must Regulate It Themselves

Malaysian Central Bank: Cryptocurrency Belongs to the People, They Must Regulate it Themselves While some governments and central banks see cryptocurrency as a massive threat to their existence and therefore formulate acidic laws that would cripple the growth of the crypto ecosystem, Bank Negara, Malaysias Central bank is taking a more democratic approach towards cryptocurrency regulation . Bank Negara, Malaysias central bank, is set to release a brief document that will enable the public to decide how best to regulate the digital currency industry. The authority has made it clear that it will neither ban nor recognize cryptocurrencies. As per the Borneo Bulletin governor of Bank Negara, Muhammad Ibrahim, who was present at the 40th-anniversary dinner party of the Harvard Business School Alumni Club of Malaysia, said that a concept paper on cryptocurrency is almost ready and the public will be given a chance to decide the fate of virtual currencies. He also noted that the central bank would not give digital money the same status with fiat currency but would instead leave its regulation to crypto investors. Basically, we will let the cryptocurrency promoters including bitcoin , ethereum, and ripple to be more transparent, the methods to be more transparent and people behind the scene are to be more transparent too. By doing so, the public can decide on its own if they want to invest in cryptocurrencies Harsh Crypto Laws would Destroy Creativity and Innovation Unlike its Asian brothers, China, Malaysia does not see blockchain-money as a threat to its economy; the country of more than 31 million people instead wants to create an enabling environment for cryptocurrency to thrive. Finance Minister II Johari Abdul Ghani hinted that placing a ban on cryptocurrency is not on t Continue reading >>

Concept Paper On Cryptocurrency To Be Finalised This Month, Bnm Governor Says

Concept Paper On Cryptocurrency To Be Finalised This Month, Bnm Governor Says

Concept paper on cryptocurrency to be finalised this month, BNM governor says Published 3 months ago on 10 February 2018 Datuk Seri Johari Abdul Ghani, had said Malaysia would not impose a blanket ban on cryptocurrency trading as more locals bet on the new investment asset class and there was growing interest for a currency that was free from regulatory claws. Reuters pic KUALA LUMPUR, Feb 10 A concept paper on cryptocurrency will be finalised this month and made available for the public to decide on the future of this form of currency, said Bank Negara Malaysia Governor, Tan Sri Muhammad Ibrahim. Basically, we are going to make the promoter of the cryptocurrency, which include bitcoin, ethereum and ripple, to be more transparent, the methodology transparent and the people behind it transparent too. Hopefully, by doing this, the people can make their decision on whether to invest in cryptocurrency, he said during a question-and-answer session at the recent 40th Anniversary Dinner of Harvard Business School Alumni Club of Malaysia. Some 250 of Harvard Business School alumni attended the dinner. He said Malaysia was taking a slightly different approach towards the cryptocurrency, unlike some countries which decided to ban it. We are not going to ban it for now, but we are going to let the market decide the future of cryptocurrency. The key point is that they must know what they are in, he said, adding that BNM did not recognise the cryptocurrency as the fiat money. Finance Minister II, Datuk Seri Johari Abdul Ghani, had said Malaysia would not impose a blanket ban on cryptocurrency trading as more locals bet on the new investment asset class and there was growing interest for a currency that was free from regulatory claws. He said banning the cryptocurrencies, including Continue reading >>

Bank Negara Keeps Tight Rein On Digital Currencies

Bank Negara Keeps Tight Rein On Digital Currencies

Bank Negara keeps tight rein on digital currencies PETALING JAYA: Bank Negara is keeping a tight rein on digital currencies such as bitcoin with effective measures against money laundering and terrorism financing risks. In its policy statement issued yesterday, the central bank emphasised that while digital currencies are not legal tender in Malaysia, it wanted to increase the transparency of digital currency activities in the country. Bank Negara highlighted that the reporting obligations on the digital currency business are not an authorisation, licensing, endorsement or validation by the bank of digital currency exchange services, and that digital currencies are not legal tender in Malaysia. Its document, entitled Anti-Money Laundering and Counter Financing of Terrorism Policy (AML/CFT) for Digital Currencies (Sector 6), incorporated the feedback received during public consultation on the exposure draft released on Dec 14, 2017. It received feedback from representatives of existing digital currency exchangers, industry associations, law firms, financial institutions, academia as well as interested individuals. The central bank pointed out that digital currency businesses are not covered by prudential and market conduct standards or arrangements that are applicable to financial institutions which it regulates. Members of the public are advised to carefully evaluate the risks associated with dealings in digital currencies. Bank Negara advised any persons involved in digital currencies to refer to the policy to determine its applicability and comply accordingly. Persons covered under the policy as reporting institutions are expected to comply with the provisions of the Companies Act 2016, including the requirement to be incorporated or registered. According to the poli Continue reading >>

Malaysia's Central Bank Releases Draft Rules For Cryptocurrency Exchanges

Malaysia's Central Bank Releases Draft Rules For Cryptocurrency Exchanges

Malaysia's Central Bank Releases Draft Rules for Cryptocurrency Exchanges Dec 14, 2017 at 20:00 UTC|UpdatedDec 14, 2017 at 21:02 UTC Malaysia's central bank has published new draft regulations for cryptocurrency exchanges that operate in the country. On Thursday, Bank Negara Malaysia announced the move in a release on its website , asking the public to weigh in on measures aimed at easing money laundering and terrorist financing concerns related to cryptocurrencies. Following months of work in this area, the proposed regulations require businesses to verify their customers' identities, monitor transactions and report any suspicious activities toMalaysian authorities. Additionally, companies must report usage statistics to the central bank. If approved, the regulations would apply to any person or company which exchanges cryptocurrency on behalf of someone else.And while the regulations acknowledge that companies might use cryptocurrencies, the nation officially still does not recognize them as legal tender. "Members of the public are therefore advised to undertake the necessary due diligence and assessment of the risks involved in dealing in digital currencies or with entities providing services associated with digital currencies." Bank Negara Malaysia is taking written feedback on the draft rules until Jan. 14, according to the release. The regulations were explained by governor Muhammad Ibrahim last month as tools to prevent illicit money transmission. While the regulations will only apply to exchanges - "which are being referred to as "reporting institutions" - the country's securities regulator is looking at creating a framework for cryptocurrencies in general as well. The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalist Continue reading >>

Cryptocurrency Traders Await Bank Negara Guidelines On Digital Coin Atms

Cryptocurrency Traders Await Bank Negara Guidelines On Digital Coin Atms

Cryptocurrency traders await Bank Negara guidelines on digital coin ATMs PETALING JAYA: Malaysia may have seen its first digital coin auto teller machine in 2016, before the global cryptocurrency craze peaked at end-2017, but the number has not grown beyond one because, as one operator sees it, the operation of such a facility currently falls under a grey area of the countrys existing laws. There was no mention of the regulation of digital coin auto teller machines more commonly known as bitcoin ATMs or BTMs in Bank Negara Malaysias (BNM) policy document on cryptocurrencies released about two weeks ago. Earlier, XBit Asia co-founder Yuwarajan K told SunBiz that the company will wait for a comprehensive framework on digital currencies before bringing in any bitcoin ATM. We dont have a bitcoin ATM yet because BNM has to come out with all these things (the framework) first. Its very simple. With an ATM, you will know whos withdrawing and depositing. There is a mechanism for knowing this. Were in talks with them (the central bank), but the framework has to be out, he said. Yuwarajan said XBit Asia, as a digital currency exchange which has been operating since September 2016, can operate BTMs which are connected to the platform, but they have chosen to hold off doing so while awaiting guidelines from BNM. PinkExc, another digital currency exchanger, brought in the countrys first BTM in 2016. Besides bitcoin, the machine, which is in Ipoh, also trades dash and litecoin. It allows trading of coins up to RM300 with a 10% processing fee per transaction. PinkExc founder Fitry Daud said the company is still in talks with Bank Negara on the operation of BTMs. We didnt receive any letter from BNM on the matter. The company has said that it plans to set up 100 BTMs in Southeast Asia Continue reading >>

Bank Negara Malaysia Issues Cryptocurrency Regulation

Bank Negara Malaysia Issues Cryptocurrency Regulation

Bank Negara Malaysia Issues Cryptocurrency Regulation Following the public consultation issued by Bank Negara Malaysia in December, the central bank has announced the official cryptocurrency regulation in Malaysia under the policy paper Anti-Money Laundering and Counter Financing of Terrorism Policy for Digital Currencies (Sector 6). The regulator emphasises once again that cryptocurrencies are not a legal tender in Malaysia and reminds the general public that they should still conduct their own due diligence when dealing with cryptocurrencies since there are no established avenues for redress for losses and damages incurred by parties dealing in cryptocurrencies. It is important to note that according to this policy paper geared towards cryptocurrencies being uses a currency and not geared towards regulating ICOs which will likely fall under Securities Commission Malaysia. Bank Negara Malaysia emphasises in this policy paper that reporting organisations i.e exchanges are not allowed to portray itself as a licensed entity under the central bank though they have reporting obligations to the regulator. Under Malaysias cryptocurrency regulation, exchanges are required to conduct adequate risk assessments on their customers in relation to the prevention of money laundering and financing of terrorism. The exchanges are also subject to conduct Customer Due Diligence or better know as Know-Your-Customer (KYC) that are not entirely different from what licensed entities regulated by Bank Negara Malaysia are subject to. In addition to that, should an exchange be making a new cryptocurrency available for trading they are required to submit their risk assessment in relation to money laundering and terrorism financing in writing to Bank Negara Malaysia. The cryptocurrency regulatio Continue reading >>

Bank Negara Malaysia Issues Cryptocurrency Regulation

Bank Negara Malaysia Issues Cryptocurrency Regulation

Bank Negara Malaysia Issues Cryptocurrency Regulation Following the public consultation issued by Bank Negara Malaysia in December, the central bank has announced the official cryptocurrency regulation in Malaysia under the policy paper Anti-Money Laundering and Counter Financing of Terrorism Policy for Digital Currencies (Sector 6). The regulator emphasises once again that cryptocurrencies are not a legal tender in Malaysia and reminds the general public that they should still conduct their own due diligence when dealing with cryptocurrencies since there are no established avenues for redress for losses and damages incurred by parties dealing in cryptocurrencies. It is important to note that according to this policy paper geared towards cryptocurrencies being uses a currency and not geared towards regulating ICOs which will likely fall under Securities Commission Malaysia. Bank Negara Malaysia emphasises in this policy paper that reporting organisations i.e exchanges are not allowed to portray itself as a licensed entity under the central bank though they have reporting obligations to the regulator. Under Malaysias cryptocurrency regulation, exchanges are required to conduct adequate risk assessments on their customers in relation to the prevention of money laundering and financing of terrorism. The exchanges are also subject to conduct Customer Due Diligence or better know as Know-Your-Customer (KYC) that are not entirely different from what licensed entities regulated by Bank Negara Malaysia are subject to. In addition to that, should an exchange be making a new cryptocurrency available for trading they are required to submit their risk assessment in relation to money laundering and terrorism financing in writing to Bank Negara Malaysia. The cryptocurrency regulatio Continue reading >>

Reasons Behind Bank Negara Malaysia's Regulations On Cryptocurrency

Reasons Behind Bank Negara Malaysia's Regulations On Cryptocurrency

Malaysias cryptocurrency guidelines determined that cryptocurrency isnt legal tender in Malaysia, and that exchanges need to adhere to KYC rules. The public needs to be careful when transacting in crypto, due to its volatility, and how Bank Negara wont be able to help in case of misconduct. Cryptocurrency is a nascent stage, but if it gains more commercial traction, countries might consider issuing a sovereign cryptocurrency as a safe alternative to counter the use of decentralised cryptocurrency. After a long wait, Bank Negara finally issued a cryptocurrency guideline in Malaysia in February; it basically decrees Malaysians can trade in cryptocurrencies, as long as exchanges and individuals collect information like theirfull name, address, and date of birth of all customers, in addition to ID documentation. This guideline came out after the market was left reeling from a recent crash in Bitcoins value . The regulator has also concluded that cryptocurrency isnt legal tender in Malaysia, so individuals who still choose to transact in them are encouraged to keep that in mind and conduct their own due diligencein case of robberies or losses. Malaysia follows a global trend looking to increase transparency in cryptocurrency tradersin hopes of a clear money trail, insight on thecryptocurrency cashflow in and out of the nation, and to help circumvent issues like money laundering. At the Malaysia Fintech Expo earlier this week, we managed to get some insight on why Malaysia has chosen to take a more permissive stance on the controversial coin. During a keynote speech by Tan Nyat Chuan, Director of the Payment Systems Policy of Bank Negara Malaysia (BNM), someamong the crowd stood up to ask questions relating to cryptocurrency. While Tan may not directly handle the crypto-regu Continue reading >>

Malaysia's Bank Negara Publishes Regulations For Cryptocurrency Exchanges

Malaysia's Bank Negara Publishes Regulations For Cryptocurrency Exchanges

Malaysias Bank Negara the countrys central bank, has just published new draft regulations for cryptocurrency exchanges that take place within this Asian nation. Announcing the developments through its official website, Bank Negara asked the public to weigh in on the new regulations as a way of countering various crimes. BNM governor Muhammad Ibrahim expects the rules to be able to stop cases of money laundering and financing terror-related concerns using digital currencies in Malaysia. The announcement was on Thursday 14th, 2017, following months of work that involved ironing out the regulatory framework. Working on it started way back in September and brought together dignitaries at a Counter-Terrorism Financing Summit, although no one expected them to have been finalized by now. Back then, Reuters had reported the giant banks motives that were in line with the countrys anti-money laundering and anti-terrorism financing Act. Proposed Regulations Are Meant For Market Integrity And Investor Projection It isnt a secret that cryptocurrencies can be used in illegal deals, including funding terrorists. Bitcoins are decentralized , unregulated and highly valuable and thats why criminals prefer to use them instead of fiat currencies. And with Malaysia having many terror-affiliated criminals, maybe this will be a smart move. The proposed regulations would require corporates to verify identities of the clients, monitor all cryptocurrency-based transactions , and report any questionable dealings to the Malaysian authorities. Furthermore, the rules will need all companies to report usage statistics to the countrys central bank regularly. The draft regulations state that everyone would be advised to follow due diligence and assess the risks involved when dealing with anything that Continue reading >>

Malaysian Central Bank To Issue Cryptocurrency Regulation In Early 2018

Malaysian Central Bank To Issue Cryptocurrency Regulation In Early 2018

Malaysian Central Bank To Issue Cryptocurrency Regulation In Early 2018 The Malaysian central bank, BNM, is expected to issue a directive to regulate the use of digital currencies in early 2018. The Malaysian central bank, Bank Negara Malaysia (BNM), is expected to issue a directive to regulate the use of digital currencies in the country in early 2018. The central bank has been discussing and working on a proposed cryptocurrency regulation for some time now and this new development is expected to be hailed by industry players. According to BNM Governor Tan Sri Muhammad Ibrahim , the introduction of regulations for virtual currencies are intended to prevent abusing the system for criminal and illegal activities and to maintain the stability and integrity of the financial system. The advent of digital currencies as some have forecast will mark the beginning of a new era in the financial sector. As authorities, we cannot be oblivious to these developments.The banking sector needs to adopt the latest and most advanced technologies to improve its risk management framework. Possible impact(s) of the new regulations on the cryptocurrency market Under the regulations, individuals who convert their virtual currencies into fiat currencies will be considered as reporting institutions and will be subjected to Malaysias Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act of 2001. This means that cryptocurrency transactions will be subjected to laws similar to those imposed on banks. However, the implementation of regulations as a guide for digital currencies would not automatically mean that the virtual tokens are already accepted as legal tender in the country. It is just seen as an indication that the central bank is keeping an open mind on th Continue reading >>

Bank Negara To Enforce Cryptocurrency Regulations In 2018

Bank Negara To Enforce Cryptocurrency Regulations In 2018

Bank Negara to enforce cryptocurrency regulations in 2018 Updated 4 months ago Published on 22 Nov 2017 12:43PM 0 comments Governor Muhammad Ibrahim says the use of artificial intelligence and big data in the financial sector will have the potential to increase the efficiency and accuracy of assessments, which is essential in a dynamic environment. The Malaysian Insight file pic, November 22, 2017. BANK Negara Malaysia will designate persons converting cryptocurrencies into fiat money as reporting institutions under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 beginning next year. Governor Muhammad Ibrahim said the move was aimed at preventing the abuse of the system for criminal and unlawful activities, and ensuring the stability and integrity of the financial system. We need to prepare ourselves, as according to many pundits, digital currencies will become the new norm. "The advent of digital currencies, as some have forecast, will mark the beginning of a new era in the financial sector. As authorities, we cannot be oblivious to these developments," he said in his welcoming remarks at the Third Counter-Terrorism Financing (CTF) Summit 2017 in Kuala Lumpur today. He said artificial intelligence, machine learning and big data technology were tools that would likely be imperative as suspicious transactions became more complex and harder to detect. "As we have learned from the Innovation Forum at this summit, the use of artificial intelligence and big data will have the potential to increase the efficiency and accuracy of assessments, which is essential in a dynamic environment. "The banking sector needs to adopt the latest and most advanced technologies to improve its risk management framework. Muhammad said greater ac Continue reading >>

No Ban On Cryptocurrency Tradings, Says Johari - The Malaysian Reserve

No Ban On Cryptocurrency Tradings, Says Johari - The Malaysian Reserve

No ban on cryptocurrency tradings, says Johari No ban on cryptocurrency tradings, says Johari BNM will not impose a blanket ban on cryptocurrencies, including bitcoin Malaysia will not impose a blanket ban on cryptocurrency tradings as more locals bet on the new investment asset class and growing interest for a currency that is free from regulatory claws. Finance Minister II Datuk Seri Johari Abdul Ghani said the central bank will not impose a blanket ban on cryptocurrencies, including bitcoin, as such action will only curb innovation and creativity in the financial sector, particularly financial technology. The government is fully aware of the need to strike a balance between public interest and integrity of the financial system, he told The Malaysian Reserve in a recent interview. Johari said the monetary authority is taking a cautious approach with digital currencies including bitcoin to ensure safety measures are in place to protect the interest of the public. It is not the intention of the authorities to ban or put a stop on any innovation that is perceived to be beneficial to the public, he said. However, similar to any financial and investment schemes, there is a need to have proper regulation and supervision to ensure any risk associated with such schemes are effectively contained, he said. Johari said although Bank Negara Malaysia (BNM) does not regulate digital currencies presently, it will ensure digital currency exchanges (DCEs) comply with requirements to conduct customer due diligence and report suspicious transactions to the authorities. While plans are in place for the central bank to recognise regulated DCEs, Johari (picture) said the appointments will only be done with the proper cryptocurrencies regulation in place. He said information obtained from Continue reading >>

Malaysia's Central Bank Issues Cryptocurrency Regulation

Malaysia's Central Bank Issues Cryptocurrency Regulation

Malaysia's central bank issues cryptocurrency regulation February 5th 2018 | Malaysia | Financial regulation The global frenzy around cryptocurrencies such as bitcoin and ethereum has caused prices to fluctuate wildly over the past year, with the price of bitcoin rising from roughly US$800/coin in January2017 to more than US$19,000/coin in December, before falling to around US$10,000 in early February2018, according to Coindesk, a news website. Malaysia has been no exception, with four crypto-exchanges currently in operation. As the market develops, concerns about criminal activity, fraud and tax evasion have led to increased regulation, which Bank Negara Malaysia (BNM, the central bank) hopes will strike a balance between security and innovation. Cryptocurrency mania has swept through Asia over the past year. Japan is fast becoming one of the largest cryptocurrency markets in the world, with nearly a third of bitcoin transactions conducted in yen. South Koreans have perhaps been the most active adopters, with its Bithumb exchange the world's busiest. Bitcoin specifically has achieved mainstream status, with bitcoin futures contracts now offered by CME Group, a Chicago-based derivatives exchange operator, and the Chicago Board Options Exchange. Malaysia has been no exception to the rule, with BNM data showing that the country's four main cryptocurrency exchanges trade an average of M$75m (US$17.3m) eachmonth. The sector's rapid rise has been touted as a major success for innovation and a new era for the financial sector. Blockchain, the digital code underpinning most digital currencies, has been heralded as a breakthrough innovation, with its distributed-ledger verification system currently being implemented by major international financial institutions to increase the Continue reading >>

No Ban On Dealings With Cryptocurrency Exchangers But Be Extra Careful In Due Diligence, Bnm Tells Banks

No Ban On Dealings With Cryptocurrency Exchangers But Be Extra Careful In Due Diligence, Bnm Tells Banks

No ban on dealings with cryptocurrency exchangers but be extra careful in due diligence, BNM tells banks Last updated on 27 February 2018 - 11:41pm PETALING JAYA: Bank Negara Malaysia (BNM) is not prohibiting banks from dealing with digital currency exchangers or businesses, but it expects them to be extra careful in their due diligence exercise in view of heightened money laundering and terrorist financing risks. The regulator stated this in a policy paper issued following a public consultation on the classification of digital currency exchanger as a reporting institution. BNM said it received feedback from representatives of existing digital currency exchangers, industry associations, law firms, financial institutions, academia as well as interested individuals. The central bank said banks should take a risk-based approach and conduct proper Know-Your-Customer/Customer Due Diligence processes in deciding whether to establish banking relationship with a digital currency exchanger. In practice, digital currency exchangers may be subjected to an enhanced due diligence process based on assessments by financial institutions of heightened money laundering and terrorist financing risks, it added. BNM said there is no restriction on using electronic means of performing the necessary CDD or verification of a customers identity, but such methods must satisfy the requirement under Section 9.3.3 of the policy paper, which stipulates that the process has to be as effective as one that is face-to-face. Reporting institutions (RI) can view identification documents physically or via electronic means, as long as the RI can reasonably determine their authenticity. BNM also said it has made an amendment to require reporting institutions to inform it of a material change or materially i Continue reading >>

Bank Negara Malaysia Issues Policy Document For Digital Currencies

Bank Negara Malaysia Issues Policy Document For Digital Currencies

Bank Negara Malaysia issues policy document for digital currencies Ref No : 02/18/07 27 Feb 2018 Embargo : For immediate release Bank Negara Malaysia (the Bank) has today issued the Anti-Money Laundering and Counter Financing of Terrorism Policy for Digital Currencies (Sector 6) which has taken into account feedback received during the public consultation period on the exposure draft released on 14 December 2017. 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. The Bank 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. 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. 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. Any pe Continue reading >>

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