Malaysia to enforce cryptocurrency regulation in 2018 – Channel NewsAsia

KUALA LUMPUR: Malaysia’s central bank, Bank Negara Malaysia (BNM), will designate persons converting cryptocurrencies into fiat money as reporting institutions under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 from 2018.

BNM governor Muhammad Ibrahim said the move was aimed at preventing the abuse of the system for criminal and unlawful activities and ensuring the stability and integrity of financial system.

“We need to prepare ourselves, as according to many pundits, digital currencies will become the new norm,” he said in his welcoming remarks at the Third Counter-Terrorism Financing Summit 2017 in Kuala Lumpur on Wednesday (Nov 22).

“The advent of digital currencies as some have forecast, will mark the beginning of a new era in the financial sector. As authorities, we cannot be oblivious to these developments.”

Muhammad said the adoption of artificial intelligence, machine learning and big data technology were tools that would likely be imperative, as suspicious transaction become more complex and harder to detect.

“As we learned from the Innovation Forum at this Summit, the use of artificial intelligence and big data will have the potential to increase efficiency and accuracy of assessments that is essential in a dynamic environment,” said Muhammad.

“The banking sector needs to adopt the latest and most advanced technologies to improve its risk management framework.”

Muhammad said that greater access to intelligence information for financial institutions and rising threat from the Islamic State had resulted in the upward trend of reporting of Suspicious Transaction Reports (STRs).