Business

Dennis Wafula

Laos central bank warns against use of ‘unregulated’ crypto

The central bank of Laos has cautioned the public against using cryptocurrency in the country. According to the notice (in pdf), the Bank of Laos (BOL) stated that the public should exercise caution when dealing with cryptocurrencies. In the notice, the central bank referred to the current Law on Payment System, No.32/NA (revised in November 2017), which refutes cryptocurrencies as payment instruments. According to the law, cryptocurrencies do not meet the standards required to be classified as a currency.

BOL advised merchants, traders, and residents to do proper research of the cryptocurrency market before they invest their assets in the “unregulated” digital coins, specially mentioning BTC, ETH and LTC, noting that engaging in the cryptocurrency market carries a big risk.

A senior government official, while speaking to local reporters, tried to define cryptocurrencies by stating, “It is not a real currency like the Lao kip or the Thai baht, because it is unable to pay debts. It is a digital record of a transaction used for exchange transitions and is not regulated by the law. People who get involved in the use of cryptocurrencies stand to lose their investments if the digital system fails.”

The official added that the country does not have an authority charged with governing cryptocurrencies, and warning people will help many investors avoid losing their assets.

The notice is also intended to prevent people from getting involved in illegal activities like money laundering and terrorism funding. Additionally, the bank believes that because cryptocurrencies suffer severe price instability, it will be hard for the authorities to come up with a proper way to regulate its activities.

Businesses in Laos have recently started accepting cryptocurrencies for payments of goods and services. Businesses are also advertising investment opportunities in the cryptocurrencies trade.

Cryptocurrencies in Asia has received mixed reactions. Some countries, such as Japan, have embraced the digital currencies, while others like Vietnam have taken a hostile approach towards crypto. Laos authorities have not banned the use of cryptocurrencies, but are asking their citizens to exercise caution.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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