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Malaysian Central Bank Has No Plans To Regulate Bitcoin
Malaysia's central bank, the Bank Negara Malaysia, has issued a brief but hands-off statement about bitcoin.
Updated Sep 29, 2023, 11:51 a.m. Published Jan 4, 2014, 12:49 p.m.
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Malaysia's Central Bank, Bank Negara Malaysia (BNM), joined others by publishing its own statement on bitcoin this week.
The statement was similar to those issued in other countries of late, but probably the briefest we've seen from a central bank so far. An announcement, posted on the bank's official website, simply said:
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"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."
There has been a flurry of similar statements around the world in the past week, from countries as far apart as Lebanon and New Zealand. All, however, have stressed two main points: bitcoin cannot be recognized as a "currency", and using it carries certain risks.
It is still unknown to what degree these statements indicate central banks internationally are washing their hands of all bitcoin-related responsibility, or whether they signal the opening moves of an eventual crackdown.
CoinDesk spoke to Colbert Low, the founder of local services and consultancy firm BitcoinMalaysia.com, about whether the central bank's statement would change anything. He said:
"Nothing changes, there are still plenty of bitcoin/altcoin trades going on.
Our secret traders' groups on [messaging platforms] Whatsapp and Kakaotalk are still going strong, with 200 plus people. ASIC (SHA256) hardware sales are also strong and there's plenty of demand from miners in Malaysia."
Low compared the BNM's stance to that of the neighboring Monetary Authority of Singapore (MAS) last month. After originally warning investors to "be wary" of bitcoin in September, the authority announced later it would not regulate it at all, saying: "Whether or not businesses accept bitcoins in exchange for their goods and services is a commercial decision in which MAS does not intervene."
Malaysia shares similar traits with Singapore in that it has a healthy supply of young IT professionals (both on the hardware and software side) and also serves as a regional hub for financial services, making it attractive ground for digital currency developers as well.
In July 2013, Thailand's central bank became the first to make strong statements about bitcoin's legal status, using the word "illegal" repeatedly to denounce bitcoin trading and use in exchange for goods and services. Some local exchanges suspended business in response.
Some claimed the news was misreported and/or exaggerated, and Thailand maintains a healthy bitcoin scene with at least two exchanges, Bahtcoin and CoinMill, still operating. The latter site carries a note that there are restrictions on trading Thai Baht, and offshore banks may only trade Thai Offshore Baht (THO). CoinMill has a calculator for current baht-bitcoin exchange rates.
Petronas Towers image via Shutterstock
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