Asia’s Bitcoin regulatory scorecard, country by country


Across Asia, Bitcoin acceptance remains divided, even as the Global Bitcoin Summit in China last week attempted to open discussions on the controversial topic.

Recently, The People’s Bank of China issued orders to banks to crack down on virtual currency activity, which saw five of China’s largest Bitcoin exchanges pull out of the event within a week.

Many attending the summit showed surprise it was allowed to go ahead, with a large number of attendees showing support for the government’s tight regulation on the currency.

Futurist and Innovation Strategist Anders Sorman-Nilsson says he thinks effective regulation remains a few years away.

“By regulating it, you are also, in a way, endorsing it. It has to become such a household form of payments or transactions that they would have to regulate it because it is in the mainstream," said Sorman-Nilsson. "Are we morally endorsing consumer behaviour by starting to regulate it?”

FST Media investigates the evolution of Bitcoin across Asia, and which countries are regulating or banning the controversial currency.

CHINA: Ban on Bitcoin.

In December 2013, China’s Central Bank, the People’s Bank of China (PBoC) made moves to regulate Bitcoin after the virtual currency’s value jumped significantly, sparking investor interest within China.

The PBoC banned financial companies from transacting in Bitcoin, which sent the value of the virtual currency down by 20 per cent. However, individuals remained free to trade with Bitcoin at their personal risk, according to media reports.

In April 2014, reports surfaced that the PBoC was considering ordering banks across the country to close Bitcoin trading accounts. According to these reports, if this order was to go through, it would be removing the last available channel for the people of China to buy virtual currency.

HONG KONG: Not regulated, warns on risk.

The Hong Kong Monetary Authority (HKMA) decided not to regulate Bitcoin in November 2013 after HKMA Chief Executive Norman Chan announced the virtual currency was out of its jurisdiction.

Off the back of China’s negative regulatory restrictions, Bitcoin continues to gain in popularity in Hong Kong, where the HKMA remains passive in its attitude toward regulating the currency.

SINGAPORE: Mostly in favour, ATMs available, and to be regulated.

The first cash-out Bitcoin ATM was launched in Singapore in March, adding to seven existing cash-in machines already existing in the country.

Although initially no moves were made by the Monetary Authority of Singapore (MAS) to regulate Bitcoin, in March 2014 the MAS announced operators of virtual currencies are to abide by new rules. The MAS has imposed these new rules to address potential terrorist funding and money laundering risks.

MALAYSIA: No regulation, Bank Negara Malaysia warns against.

There is currently no regulation in place for virtual currencies in Malaysia, however in January 2014, the Central Bank of Malaysia, Bank Negara Malaysia (BNM) released a statement warning against the use of Bitcoin.

BNM’s statement said there will be no regulation put in place but advised the Malaysian public to be cautious in dealings with digital currency.

THAILAND: No Regulation, Bank of Thailand warns against.

Although initial reports suggested that The Bank of Thailand (BoT) had essentially banned Bitcoin, the statement released by the bank in January 2014 only warned the public that Bitcoin is not a currency.

Reports in July 2013 suggested Bitcoin is banned in Thailand, with Bitcoin related activities deemed illegal. In fact, the statement outlined that using Bitcoins was illegal due to a lack of existing laws.

In March 2014 the BoT issued a statement saying it did not recognise Bitcoin as a currency, but it was not illegal and warned against its use. A translation of that statement can be found here

The BoT has since decided that the operation of Bitcoin exchanges does not fall under its authority.

VIETNAM: Vietnam’s Central Bank officially bans Bitcoin.

In March 2014 the Central Bank of Vietnam announced it would no longer support Bitcoin and officially banned Bitcoin transactions, which will not be protected by Vietnam’s law.

Despite the ban, in late March reported that a Bitcoin trading floor was to be established in Vietnam in April, however there have been no new developments on this since.

PHILIPPINES: Bangko Sentral mulls regulatory approach.

In March 2014, a statement made by the Governor of Bangko Sentral Philippines (BSP) said the central bank had been studying how to regulate Bitcoin in the Philippines.

This is despite reports of an online exchange launched in January 2014 allowing consumers to buy and sell Bitcoins by depositing cash at many Bank of Philippine Islands branches.

INDONESIA: Illegal, but not regulated.

In January 2014, the deputy Governor of Indonesia’s Central Bank, Ronald Waas, stated that the currency violated three of Indonesia’s laws, but the bank had no authority to punish those breaking these laws, thus allowing consumers to use the currency at their own risk.

In February 2014 a statement by the Central Bank took a mo re neutral stand on Bitcoin: while it does not recognise Bitcoin as a currency, it issued a warning to individuals who wanted to take the risk. (Translation of document here.)

INDIA: The Reserve Bank of India cautions against risk

To date, Bitcoin remains unregulated in India, with no plans in place for any regulatory framework.

A statement by the Reserve Bank of India (RBI) made in December 2013, outlined that the currency was not recognised by any bank or monetary authority, and cautioned users against the risks associated with trading in Bitcoin.