Malaysia has begun work on a regulatory structure for digital currencies such as Bitcoin (Bitcoin), its central bank governor said on Wednesday, Reuters reported.
“We need to prepare ourselves, as according to many pundits, digital currencies will become the new norm," Governor Muhammad Ibrahim told a counter-terrorism financing summit.
"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," he said.
From next year those converting cryptocurrencies into conventional currency will be designated as “reporting institutions” under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act, he said.
Reporting institutions are required by law to undertake preventive measures to prevent their firms from being used as a conduit for money laundering and terrorism financing activities, according to the central bank.
“This is to prevent the abuse of the system for criminal and unlawful activities and ensuring the stability and integrity of the financial system,” Muhammad said.
He did not say when the regulations would be finalized.