Bitcoin trade should be regulated by anti-money laundering rules

04/02/2018 08:17 PM
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Taipei, April 2 (CNA) Taiwan's central bank Governor Yang Chin-long (楊金龍) said Monday that transactions of the cryptocurrency Bitcoin should be regulated by anti-money laundering rules.

In a hearing held by the Finance Committee of the Legislative Yuan, Yang, who took the helm of the central bank in late February, suggested that the Ministry of Justice include Bitcoin into the purview of Taiwan's Money Laundering Control Act due to the digital currency's lack of regulation.

With more and more investors chasing the virtual currency, many countries have been watching closely whether Bitcoin is being used for money laundering.

The United States is one of those countries. In the most recent case, a Bitcoin trader in Arizona has just been found guilty of money laundering by a Phoenix Federal Jury.

Yang's comments echoed an earlier statement he made at a news conference after the central bank's quarterly policymaking meeting held March 22, in which he urged the government to regulate Bitcoin in a bid to avoid disruption of the local financial market order.

In the March 22 statement, Yang said major central bankers and international financial organizations are against legalization of trading in virtual currencies like Bitcoin.

Yang said in the statement that since 87.5 percent of the Bitcoin transactions have been owned by only 0.61 percent of the trading accounts in the world, it is easy for the virtual currency to be manipulated.

In Monday's hearing, Yang reiterated the need for local Bitcoin investors to pay close attention to possible risks when they trade the digital currency.

Yang also told lawmakers that while it remains to be seen whether a trade war between the United States and China will erupt any time soon, he can foresee that any trade friction between the world's two largest economies will have an adverse impact on Taiwan's economy, as 60 percent of its gross domestic product comes from exports.

A day earlier, the Chinese government said it is planning to immediately impose tariffs on 128 U.S. products, including pork and select fruit, which has been perceived as a direct response to U.S. President Donald Trump's recent moves to pursue numerous trade restrictions against Beijing.

Yang said, however, that there is still a chance for Washington and Beijing to avoid an all-out trade war as long as the two sides can negotiate.

In the hearing, Yang dismissed local media reports over the weekend that the central bank is likely to boost Taiwan's purchasing power to increase domestic investment, so that it is possible for the bank to boost interest rates to maintain a stronger Taiwan dollar against the U.S. dollar.

Yang said the reports misinterpreted a central bank written statement submitted to the Legislative Yuan for Monday's hearing.

He said the central bank's written statement did address the problem of the anemic domestic investment, but never said it wants to see interest rates and the Taiwan dollar value grow as a way of raising Taiwan's purchasing power and eventually increasing domestic investment.

(By Chiu Po-sheng and Frances Huang)


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