Sri Lankan central bank urges caution on crypto

The Central Bank of Sri Lanka (CBSL) has warned consumers that bad cryptocurrency actors may be trying to take advantage of the current economic and political crisis.

As trust in the CBSL’s fiat currency is undermined, cryptocurrency exchanges have begun to target citizens.

The CBSL has issued a reminder that it has not authorized or given licenses to any entity to date nor has the bank granted permission to cryptocurrency companies to operate or target citizens.

The latest notice, entitled “Public Awareness in Relation to the Use of Virtual Currencies in Sri Lanka”, focused on better understanding how bad actors may be attempting to win over inexperienced investors scared by the current economic downturn.

The CBSL reminded citizens not to invest in unlicensed cryptocurrency exchanges, warning that a spate of bankruptcies in the industry should serve as a warning.

There have been no virtual currency exchanges, mining operations or initial coin offerings approved or authorized by the CBSL, the bank added.

“Therefore, VCs are considered as unregulated financial instruments and have no regulatory oversight or safeguards relating to their usage in Sri Lanka”, the notice said.

The CBSL said that the public should be aware of entities and companies attempting to exploit the current situation and be aware of the potential significant risks that people investing in cryptocurrencies face.

The CBSL gave the examples of security, financial and legal problems that may follow because of the use of such currencies.

The country saw protestors attack the Sri Lankan prime minister’s compound last week among social unrest.

Meanwhile, you can still use cryptocurrencies and spend them at Bitcasino, 1xBit or FortuneJack.

Source

Updated: 07/18/2022 — 19:00