In the midst of economic and political turmoil, the Central Bank of Sri Lanka, or CBSL, has warned the public not to buy crypto due to lack of regulatory oversight.
In the news Tuesday, CBSL said has not authorized or licensed any company in Sri Lanka to offer crypto-related services, including exchanges, initial coin offerings and mining. The central bank said the warning was in response to “recent developments regarding the use of virtual currencies,” which show a market decline and significant volatility in the price of cryptocurrencies like Bitcoin (BTC).
The virtual currency “… is considered an unregulated financial instrument and has no regulatory oversight or security related to its use in Sri Lanka,” CBSL said. “The public is warned of the potential exposure to significant financial, operational, legal and security risks, as well as customer protection concerns posed to users by investing in VCs.”
The announcement comes amid inflation in Sri Lanka which reached more than 54% in June as SBSL bank raised interest rates to 15.5%. According to data from the central bank, inflation was about 45% when published, affecting the cost of living for 22 million people living in Sri Lanka.
On Saturday, hundreds of protesters stormed the house of Sri Lankan President Gotabaya Rajapaksa in Colombo, it was later reported. grab 17.8 million rupees – about $ 50,000 when it was issued – controlled the building, used the facility and ate food in storage. Thousands of Sri Lankans also have it brought to the streets of the capital as a protest against the government’s response to the economic situation. Parliamentary speaker Mahinda Yapa Abeywardena said Rajapaksa would step down on Wednesday.
Protesters entered the home of President Gotabaya Rajapaksa of Sri Lanka on Saturday, amid massive protests over the country’s economic crisis. The country’s political leaders demanded his resignation. https://t.co/R2N2OQLhZ9 pic.twitter.com/3tgR68dfDU
– The New York Times (@nytimes) July 9, 2022
related: Sri Lanka appointed a committee to implement crypto and blockchain mining
Though publicly voiced warnings about crypto, Sri Lanka’s central bank previously helped developing a Know Your Customer concept proof project as part of a government initiative aimed at exploring the use of blockchain and crypto mining. Some social media users claim to be in Sri Lanka as well said he will hold a stablecoin like a USD Coin (USDC) is a hedge for high inflation and state bankruptcy.
