Sri Lanka told to adopt cryptocurrencies ...
Sri Lanka could increase remittance earnings through adopting cryptocurrencies such as bitcoin for transferring remittances to Sri Lanka, avoiding cross-border transaction.
Addressing ‘Blockchain Sri Lanka 2018’ by the Business Process Outsourcing Services Sri Lanka, this week in Colombo, Zap.org CEO and Co-founder and Blockchain Technologies Corp and Bitcoin Centre NYC Founder Nick Spanos suggested that the Sri Lankan expatriates could utilise cryptocurrencies to send their earnings to Sri Lanka, avoiding cross-border transaction fees and fees of money transfer services.
Spanos pointed out that Sri Lanka’s remittance earnings, which are around US $ 7 billion per annum, could save around 12-15 percent of various transactional fees charged on remittances by money transfer services.
He called Sri Lankan youth to embrace the permissionless blockchains such as bitcoin, Ethereum, etc. to drive the blockchain revolution in Sri Lanka, while asserting that the permissionless blockchains are based on decentralisation, transparency, trust and democratic principles to achieve monetary independence. spanos emphasised that Sri Lanka has the potential to become Switzerland of South Asia.
While dismissing bitcoin is a bubble, Spanos stressed that something scarce as bitcoin cannot be a bubble, contrary to the Wall Street. Spanos elaborated that the cryptocurrencies have many use cases, such as micro credits, where a person based in New York could offer microfinance to a rural farmer in Sri Lanka. Delivering his remarks, Central Bank of Sri Lanka (CBSL) Deputy Governor and National Payment Council Chair C.J.P. Siriwardana said that blockchain solves many shortcomings that digitalisation thus far has been unable to resolve. However, he noted that the CBSL, like the majority of other central banks, doesn’t intend to regulate permissionless blockchains, which cryptocurrencies such as bitcoin and Ethereum are based on. Hence, Sri Lankans could engage in cryptocurrency transactions at their own risk. Speaking of adoption of blockchain technologies in Sri Lanka, Siriwardana noted that the National Payment Council appointed a committee on blockchain technology that made recommendation regarding the use of blockchain technology in Sri Lanka and in the financial sector. “These recommendations are being studied within the CBSL,” he said.
Siriwardana stressed that shift to blockchain technologies systems should take place gradually as they require significant changes to organisational and governance structures.
“If you are adopting blockchain at a larger scale, you may need significant changes to organisational and governance structures but changes to intangible infrastructure must be done carefully as important implicit systems and practices could be lost. Therefore, change must be implemented gradually while respecting the existing systems, regulations, cultures and know-how,” he said.