Digital currency transactions worth RM75 mln per month

KUALA LUMPUR: Malaysia is seeing RM75 million transaction per month being processed through the digital currency platform, Bank Negara Malaysia ( BNM) said.

Deputy Governor Abdul Rasheed Ghaffour said the value, however, was still marginal compared to the market capitalisation of digital currency globally which stood at US$ 420 billion ( RM4.07 per dollar).

Nevertheless, he said the central bank is taking a step forward by planning to introduce the invocation of reporting obligations policy that is set to make digital currency more transparent and to prevent misuse of digital currency for money laundering and terrorism financing early next year.

“The invocation of reporting obligations would make digital currency exchange ( business) as reporting institutions under the Anti- Money Laundering, AntiTerrorism Financing and Proceeds of Unlawful Activities Act 2001 (AMLA),” he told reporters at a briefing here yesterday.

Abdul Rasheed said the proposed policy would also enable the central bank to gather more data and gain further understanding on the digital currency that would help BNM determine future directions.

“The information we are looking at are the number of transactions, conversion of digital currencies to fiat money, as well as digital currency to other digital currency,” he said.

He said BNM would also gather information on value of transaction, net buy and sell positions of transaction, purpose of transaction, payment method, number of customer accounts, and the outstanding value of customer accounts. He added that the policy, once kicked-off, would require digital currency exchanges to report on a monthly basis to the central bank and failure to do so would result in a penalty of not exceeding RM1 million.

Abdul Rasheed said however, BNM has no intention to ban the usage of digital currency in Malaysia as such move would kill innovation and creativity.

“What is important is to strike a balance. We want to see innovation and creativity that can benefit consumers and the nation while protecting the integrity of the financial system.

Asked whether Bitcoin, a form of digital currency, is in a bubble, he said its characteristic is similar to a price bubble.

“If you look at the price, it is very clear it’s like a bubble. What it was when it was issued and what is the price today.

“If you look at any other investments, I don’t think you’ll get much high return. Everything that has high return has a high risk. I wouldn’t disagree with that ( Bitcoin in a bubble),” he added. — Bernama