Crypto Promoters Will Be Treated as Financial Institutions, says Central Bank of Samoa
The Central Bank of Samoa warns crypto promoters that they will be treated as financial institutions and they will have to abide by the country’s existing legislation on money laundering.
According to a statement issued by the reserve bank of Samoa, individuals who promote cryptocurrencies in the island are expected to obtain the necessary licenses and follow the reporting requirements like all other financial institutions. The statement states:
“…any person who wishes to promote Cryptocurrency or Digital currency is considered under the Money Laundering prevention Amendment Act 2018 as a Financial Institution. This means it must have a valid business licence issued in Samoa and is required to follow the Central Bank’s reporting requirements for Financial Institutions.”
Along with, the Central Bank of Samoa (CBS) warned the crypto enthusiasts that the cryptocurrencies are not accepted as a currency in the island country as they do not possess the necessary legal tender. In doing so, CBS advised investors to understand the risks associated in digital currencies before investing. The Central Bank of Samoa said:
“People who invest in any of the cryptocurrencies do so at their own risk. There is no guarantee that cryptocurrencies will be accepted as a medium of exchange, or will hold their value.”
This will not be the first time that the regulator came after cryptocurrencies. Four months ago Samoa’s central bank issued a directive blocking all foreign exchange transactions involving the controversy-laden Oncecoin cryptocurrency. The CBS cited their suspicion regarding Onecoin being a pyramid scheme as a reason for the ban. Moreover, CBS added that this was in the best interest of the country’s forex reserves. The statement released mentioned:
“This also ensures the protection of Samoa’s foreign currency reserves, which is at risk due to the high number of people wanting to remit money overseas for this get rich quick scheme.”
The CBS is not the only reserve bank in the Asia-Pacific region to have come out against cryptocurrencies in the recent past. A few days ago, the Bank of Laos recently warned against cryptocurrencies saying they did not qualify to be classified as currencies.
Much like many countries, the CBS maintains aversion towards cryptocurrency while shows a keep interest in blockchain technology. The regulator believes in Blockchains transformative technology, especially in the financial sector. Thus, the reserve bank of the Asia-Pacific nation is exploring blockchain technology as a ‘platform for promoting financial inclusion in Samoa’.
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