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Cryptocurrency Regulations Likely in Malaysia by 2018

Cryptocurrency Regulations Likely in Malaysia by 2018

Malaysia has begun working on a regulatory structure for crypto currencies. Malaysia's central bank and Bank Negara Malaysia (BNM) have joined hands to work on regulations for digital currencies with the objective of securing the country against money-laundering and terrorism financing. The regulations, expected by 2018, will fall under Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001.

Speaking at the Third Counter-Terrorism Financing Summit 2017 in Kuala Lumpur, BNM governor Muhammad Ibrahim said that digital currencies have become the new norm and emphasised on the importance of having regulations in place to prevent the abuse of the system for criminal and unlawful activities, as well as ensuring the stability and integrity of existing financial systems.

He added that embracing artificial intelligence, machine learning and big data technology is of utmost importance with increasing difficulties to spot suspicious transactions. Also, he stressed on the use of artificial intelligence and big data to improve the efficiency and accuracy of assessments essential in a dynamic environment.

Muhammad was of the opinion that the banking sector can improve its risk management framework by adopting the latest and most advanced technologies. He also called it a necessary step going into the future considering the upward trend of Suspicious Transaction Reports (STRs).

In the first six months of 2017, the Malaysian authorities have received 346 STRs related to terrorism financing, compared to 93 reports in 2015. There have been hundreds of arrests in this regard over the past few years. On several occasions, the Southeast Asian country has been on high alert with attack threats.

Meanwhile, Australian Justice Minister Michael Keenan has assured commitment and support to Indonesia with sharing of intelligence.

The summit was organised in collaboration by Australian and Indonesian financial intelligence units. The four-day forum was graced by 350 participants from 35 countries.