Central Bank of Malaysia to Enforce Cryptocurrency Rules in 2018br>
Tan Sri Muhammad Ibrahim, governor of Bank Negara Malaysia (BNM), said that work on a regulatory structure for cryptocurrency has commenced. Starting next year, any person converting cryptocurrency into fiat money would be designated as reporting institutions under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001.
Speaking at the Counter-Terrorism Financing Summit 2017 in Kuala Lumpur, Ibrahim said the move is to prevent the abuse of the system for criminal and unlawful activities and ensuring the stability and integrity of the financial system.
“The advent of digital currencies as some have forecast, will mark the beginning of a new era in the financial sector,” said Ibrahim said. “As authorities, we cannot be oblivious to these developments.”
The central bank governor suggested a defense strategy within the financial system, capitalizing on technology, promoting ‘clever partnership’ between the authorities and industry and closer international cooperation.
Ibrahim said artificial intelligence, machine learning and big data technology were tools that would likely be imperative as suspicious transactions became more complex and harder to detect.
“As we have learned from the Innovation Forum at this summit, the use of artificial intelligence and big data will have the potential to increase the efficiency and accuracy of assessments, which is essential in a dynamic environment,” the governor said. “The banking sector needs to adopt the latest and most advanced technologies to improve its risk management framework.”
The central bank is also finalizing the details of a new requirement for the banking and money services business sector to report remittances in high risk areas. He said the high-risk areas will be determined based on law enforcement agencies’ intelligence on areas that they view may pose a higher risk in terms of funding of terrorism activities.