I'm in Kuala Lumpur for a few days and it's been a beautiful experience so far as always. Malaysia is a well managed country and I had to look into some of the policies surrounding cryptocurrencies and suffice to say I'm quite pleased to learn about it.
Bank Negara Malaysia is the Central Bank of Malaysia and they have been debating cryptocurrencies and policies around them for a while now. Recently the governor of the central bank made a statement saying that they are working on a concept paper for cryptocurrencies but will leave the fate of its regulation to its crypto investors.
“Basically, we will let the cryptocurrency promoters including bitcoin, ethereum, and ripple to be more transparent, the methods to be more transparent and people behind the scene are to be more transparent too. By doing so, the public can decide on its own if they want to invest in cryptocurrencies” -BTCManager
Bitcoin compared to stocks are relatively new to the world. The market is unregulated and its extremely volatile owing to low liquidity when compared to the currency markets. According the the Malaysian Central Bank, for authorities to fully regulate the market and come out with policies that allow people to trade effectively while also safeguarding their money and prevent security loopholes, they (officials) need to fully understand what they are dealing with.
In fact the finance minister of Malaysia in an earlier report has clarified that banning cryptocurrencies are not a solution as it could be damaging to the growing fintech sector in Malaysia. Overall the situation looks very positive with the central bank expected to come out with a democratic policy which allows safer trading of these currencies in Malaysia.
They are certainly open to adopting these technologies even if they are largely used for speculative purposes.
We live in a world where government control over our freedom is growing excessively and sometimes it is unchecked. India is somewhere in the middle where the government is trying to enforce greater number of laws especially on our finances and the country is pushing back on it sometimes.
Indian central bank feels endangered with the rising popularity of decentralised 'crypto-assets'-it is what govt of India likes to call cryptocurrencies. Hopefully in the year to come we'll see some positive changes after the government releases the draft of the framework on cryptocurrency here.
Malaysian central bank is doing the right thing and it's amazing how this country and their forward thinking government recognises the growing significance of cryptocurrencies in the world, and how it can benefit their economy and their people.
Even as the Malaysian government has said that they won't give cryptocurrencies the same status as the fiat currency, it expects the public to pitch in on how they want to see the growth of this sector in Malaysia.
Indian government needs to take a cue from this and learn that they can't afford to get left behind. It's time to do something positive and proactive for the benefit of the Indian economy by supporting mainstream adoption of cryptocurrencies instead of curbing its use for speculative purposes or as legal tender.
It is not easy for any country to recognise a secondary financial instrument on par as it's own legal tender and give it any kind of legal status that brings it on par with their fiat currency. However, some governments thinking long term and understanding the fact that these disruptive new technologies are here to stay.
The fact that some governments understand this, and are trying to work with the given situation actually gives me hope. Because we are indeed ushering towards a smarter economy in the world where cryptocurrencies will be a major part of our everyday lives.
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