Bank Negara Malaysia (the central bank of Malaysia) has published an Anti-Money Laundering and Counter Financing of Terrorism Policy for Digital Currencies. The document sets out the minimum requirements that a reporting institution must observe to increase the transparency of activities relating to digital currencies, such as Bitcoin, to ensure effective and robust AML/CFT control measures to mitigate risks of utilization for illegal activities. The Bank said it has taken into consideration feedback received during a public consultation that was initially released in December of 2017.
The Bank said it received feedback from representatives of existing digital currency exchangers, industry associations, law firms, financial institutions, academia as well as interested individuals.
The Bank said that promoting greater transparency in the use of digital currencies serves to protect the integrity of the financial system and strengthen incentives to prevent their abuse for illegal activities. In brief, any person or entity exchanging digital currency is subject to obligations under the Anti-Money Laundering, Anti-Terrorism Financing andThe
Feedback received from respondents mainly focused on the obligations imposed on digital currency exchangers, including businesses providing intermediary services involving digital currencies.
The Bank reiterated that the incorporation of reporting obligations on digital currency exchanges does not indicate authorization of cryptocurrency exchanges. The Bank has also repeatedly warned the public that digital currencies are not legal tender in Malaysia and thus not covered by certain conduct standards that are applied to other regulated entities.
The Bank said it will continue to monitor developments in this area through data submitted to the Bank, and the Bank may publish information that is relevant to inform the public on risks associated with digital currency activities.
Bank Negara Malaysia AML KYC Digital Currencies 2018