Sri Lanka on crypto

Central Bank Of Sri Lanka Warns Citizens Against Crypto

  • Central Bank of Sri Lanka warned investors against cryptocurrencies in a recent notice
  • The bank maintains a strict stance on cryptocurrencies as the market remains bearish

The situation for crypto investors in the Asian country of Sri Lanka remains uncertain as the central bank of the nation issues a warning to the crypto investors in the country regarding these blockchain-based assets.

The central bank “considered the recent developments in relation to virtual currency usage in the international and domestic markets as well as the inquiries related to virtual currency” and then release the official statement.

The Central Bank of Sri Lanka believes that cryptocurrencies “largely unregulated digital representations of value that are issued by private entities and can be electronically traded” hinting at the fact that it is not safe to buy and sell these tokens because they are not in control of the government but rather in control of unknown entities.

The central bank doubled down on its previous decisions regarding cryptocurrencies stating that the bank (CSBL) has not allowed Initial Coin Offerings or ICOs to operate in the nation and linked to its press releases in 2018 and 2021 wherein the Central Bank of Sri Lanka confirmed that it hasn’t given any license or authorization to any entity “to operate schemes involving VCs, including cryptocurrencies, and has not authorized any Initial Coin Offerings (ICO), mining operations or Virtual Currency Exchanges.”

“As per the Directions No. 03 of 2021 under Foreign Exchange Act, No. 12 of 2017 issued by the Department of Foreign Exchange of CBSL, Electronic Fund Transfer Cards (EFTCs) such as debit cards and credit cards are not permitted to be used for payments related to virtual currency transactions,”

said the notice issued by the Central Bank of Sri Lanka

At last, the central bank added that cryptocurrencies and digital assets are unregulated in the nation and such investment is not safeguarded by the law. It also warned the public not to fall prey to various types of VC schemes offered through the Internet and other forms of media which has become quite common recently.

The CBSL believes that there are “significant financial, operational, legal and security related risks” associated with cryptocurrency investment that the investors in the nation need to understand.

Parth Dubey Verified

A crypto journalist with over 3 years of experience in DeFi, NFT, metaverse, etc. Parth has worked with major media outlets in the crypto and finance world and has gained experience and expertise in crypto culture after surviving bear and bull markets over the years.

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