BNM has no immediate plan to issue central bank digital currency, said Dewan Rakyat

KUALA LUMPUR (December 15): Bank Negara Malaysia (BNM) has no immediate plan to issue a central bank digital currency (CBDC), said Deputy Finance Minister II Yamani Hafez Musa.

He said that in Malaysia, the national payment systems, including the real-time retail payments platform, are operated in a secure and efficient manner to meet economic needs and at the same time enable digital payments on time. real.

“The financial system in Malaysia continues to support the functioning of the economy while meeting the needs of individuals and businesses.

“However, BNM will continue to actively assess the potential of a CBDC to achieve public policy goals,” he said during the question-and-answer session at Dewan Rakyat on Wednesday (December 15).

Yamani Hafez was responding to a question from Lukanisman Awang Sauni (GPS-Sibuti) who wanted to know the government’s strategy to ensure that Malaysians, especially young people, are not left behind in understanding blockchain technology, its position on the use of cryptocurrencies in daily transactions. and initiatives to process its own crypto-currencies (stablecoins).

The deputy minister said the rapidly changing landscape of payments and cryptocurrencies had prompted central banks to assess whether or not to issue a CBDC.

“A CBDC is a digital payment instrument issued by a central bank, and it is explored and studied by various central banks around the world,” he added.

Yamani Hafez said that among government initiatives to ensure Malaysians, especially young people, are not left behind in understanding blockchain technology is the organization of the annual SCxSC Fintech conference by the Securities Commission. Malaysia (SC) for eight years since 2014.

“This year, the SCxSC conference was held October 26-28. Of the participants, 60% were from the group of young people aged 35 or younger.

“In the financial industry, the first application of blockchain technology is in cryptocurrencies or digital currencies, such as Bitcoin,” he said.

Regarding the government’s position on the use of cryptocurrencies in day-to-day transactions, he said digital assets could be issued by companies for fundraising purposes, but are also subject to compliance by issuers of the conditions set by the SC as provided for in Capital Markets and Services (prescription of securities) (digital currency and digital token) Order 2019.

Regarding the use of cryptocurrencies for payment purposes, he stated that cryptocurrencies such as Bitcoin and Ethereum are not recognized as legal tender currencies in Malaysia and are not regulated payment instruments. by BNM.

“Cryptocurrencies are not suitable for use as payment instruments because currencies do not have the universal characteristics of money,” he said.

In general, he said that cryptocurrencies are not a good store of value or a good medium of exchange due to the risk that cryptocurrencies are vulnerable to volatile price movements and exposure to cyberthreats and lack of scalability.

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