CBSL issues a waning on virtual currency

COLOMBO (News 1^st) – Issuing a media release the Central Bank of Sri Lanka (CBSL) notes that no license or authorization has been issued to any entity to operate schemes involving virtual currencies, including crypto currencies. The CBSL also notes that they have not authorized any Initial Coin Offerings . The CBSL says it is aware of the growing interest in virtual currencies, both domestically and internationally. It adds that 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. The release adds that though unintentional, the usage of crypto currency could amount to breaches of anti-money laundering and terrorism financing laws. It concludes by stating that crypto currencies, in the present form, 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.