Bank

Crisis in Sri Lanka Use of cryptocurrency Central bank warns public not to deal with economic upheaval

Dove: The Central Bank of Sri Lanka has warned the public against the use of cryptocurrencies amid the severe economic crisis in the country, saying that this market is “largely unregulated”.

The bank, CBSL, said in a notice that the public is “warned of the possible exposure to significant financial, operational, legal and security risks as well as the customer protection issues posed to users by investments. in virtual currencies (VC)”.

The public is also warned not to fall prey to various types of venture capital schemes offered through the internet as well as other forms of media, the bank added.

The warning came as new Prime Minister Ranil Wickremesinghe on Wednesday ordered the imposition of a curfew in Western Province with immediate effect and emergency law across the island.

Security forces were ordered to arrest those acting riotously and seize the trucks they were traveling in.

On July 9, defying similar forces, the people took over the president’s house, his office and the prime minister’s official residence, symbolically overtaking the government and the presidency.

The CBSL said virtual currencies are largely unregulated digital representations of value that are issued by private entities and can be traded electronically.

“CBSL has not granted any license or authorization to any entity or company to operate systems involving VCs, including cryptocurrencies, and has not authorized any initial coin offering (ICO), mining operations or exchanges of virtual currencies,” the bank said.

Also, electronic funds transfer (EFTC) cards such as debit cards and credit cards are not allowed to be used for payments related to virtual currency transactions, he added.

“Therefore, VCs are considered unregulated financial instruments and have no regulatory oversight or safeguards regarding their use in Sri Lanka,” the bank said.

(This report was published as part of the auto-generated syndicate newsfeed. Other than the title, no edits were made to the copy by ABP Live.)

Disclaimer: Crypto products and NFTs are unregulated and can be very risky. There may be no regulatory recourse for any loss arising from such transactions. Cryptocurrency is not legal tender and is subject to market risk. Readers are advised to seek expert advice and carefully read the offering document(s) and related material literature on the subject before making any type of investment. Cryptocurrency market forecasts are speculative and any investment made will be at the sole cost and risk of the readers.