News

CB cautions against the use of virtual currencies in Sri Lanka

16 April 2018 - 168   - 0


Sri Lanka’s Central Bank (CB) on Monday alerted the public to the dangers of dabbling in cryptocurrencies which it said “may pose significant risks in terms of financial, operational, legal, customer protection and security related risks to their users as well as to the economy”.
In a public announcement, the CB – wading into these ‘new currencies’ long after it has been in ‘circulation’ – said that it has not given a licence or authorization to any entity or company to operate schemes involving virtual currencies, including cryptocurrencies, and has not authorized any Initial Coin Offerings (ICOs).
The statement, which opens saying “the CB is aware of the growing interest in virtual currencies (VCs), both domestically and internationally”, noted that the term “virtual currencies” is commonly used to refer to digitally created representations of value that are issued by private developers and denominated in their own unit of account. 
The statement added:
“Common examples of virtual currencies are cryptocurrencies such as Bitcoin, Litecoin and Ethereum. Virtual currencies are not central bank issued currency.
Virtual currencies such as cryptocurrencies use decentralised peer-to-peer digital networks to authorize transactions. Due to the absence of a centralized authority such as a Central Bank to guarantee the value of the currency and regulate transactions, there is no recourse in the event of any user or transaction related issues or disputes.
The value of virtual currencies is dependent on speculation and is not backed by an underlying asset or a regulatory framework. Due to this, virtual currencies may demonstrate major volatility. Similarly, there appears to be a high probability of virtual currencies being used in illegal activities. Further, though unintentional, their usage could amount to breaches of anti-money laundering and combating the financing of terrorism (AML/CFT) laws.” 

  Comments - 0

  • Leave a comment

Top Stories

Esala Mangalya of Devinuwara Sir Vishnu Devalaya

The 761st annual Esala Maha Mangalya of the historic Devinuwara Sri Vishnu Devalaya commenced in the early hours of last Saturday (14) with the �...

21 July 2018 - Views : 53

NYT allegations debate hit by lack of quorum

20 July 2018

Malaysian Deputy Chief Minister’s alleged links to LTTE to be investigated: Report

20 July 2018

Court issues summons to Gota and six others

20 July 2018



style="display:inline-block;width:300px;height:250px"
data-ad-client="ca-pub-6200193111498313"
data-ad-slot="1999573490">

 

Features & Analysis

George Keyt Foundation present 22nd edition of ‘Nawa Kalakaruwo’

The George Keyt Foundation is bringing the twenty second edition of it’s annual exhibition ‘Nawa Kalaka...

Cricketers pay a visit to the Apeksha (Cancer) Hospital in Maharagama

Sri Lanka Cricket (SLC) donated medicines worth Rs. 1 million to the Apeksha (Cancer) Hospital in Maharagama last eve...

“Disrupt Asia 2018” set to ignite Sri Lanka’s start-up landscape

Disrupt Asia 2018, the 3rd edition of Sri Lanka's Premier Start-up Conference and Innovation Festival, is set to ...

When Nigella was in Colombo

Eager fans of British TV chef and author Nigella Lawson seized the opportunity to get up close and personal with thei...



style="display:inline-block;width:300px;height:250px"
data-ad-client="ca-pub-6200193111498313"
data-ad-slot="1999573490">