Digital Currencies Are Not Legal Tender According To BNM

Digital Currencies Are Not Legal Tender According To BNM

Digital currencies are considered not legal tender in Malaysia.

Bank Negara Malaysia (BNM) has warned the public to carefully evaluate the risk in dealing with digital currencies and that users were not protected by existing banking laws. These risks include high volatility in prices, the lack of deep markets and vulnerabilities to cyber-attacks.

As of now, the central bank is making dealings in digital currencies more transparent in Malaysia by invoking reporting obligations on digital currency exchange business under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (AMLA).

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Even so, this does not mean BNM is regulating digital currencies. This policy only sets out the legal obligations, requirements and standards that digital currency exchangers must carry out as reporting institutions.

It also did not mean that digital currency exchangers will receive authorisation, licensing, endorsement or validation by the bank of any entities involved in the provision of digital currency exchange services.

For now, those who fail to declare their details or to comply may be subjected to enforcement and non-compliance actions as provided under the AMLA, as well as potential termination or denial of use of financial services in Malaysia.

[Source]

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