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Bitcoin easily used in money laundering, terror financing: Governor of the Central Bank of the UAE

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The governor of the central bank of the United Arab Emirates (UAE) criticized bitcoin by considering it like a non-official currency supervision.

Mubarak Rashed Al Mansouri, governor of the UAE's Central Bank, met with reporters on the sidelines of the Islamic Financial Services Council summit in Abu Dhabi this week, when he reprimanded Bitcoin. According to the Emirates news agency, the official also said that no licenses had been issued to bitcoin start-up companies or cryptocurrency companies to operate in the local area.

The central banker reportedly stated:

Some nations have announced that they do not use Bitcoin, and as a result, its value has fallen sharply. In addition, it can be easily used in money laundering and terrorist activity financing.

While the comments are noteworthy for their harsh criticism of the world's largest cryptocurrency, the UAE's central bank reluctantly contradicted that it did not ban bitcoin or any crypto-currency anymore. early this year.

On January 1, the authority issued a new regulatory framework [PDF] for payment systems, with a notable statement that reads: "All virtual currencies (and their transactions) are prohibited. A month later, the head of the central bank moved to confirm that virtual currencies would be exempted from the new regulation.

"[T] This regulation does not cover" virtual currency ", defined as any type of digital unit used as a means of exchange, a unit of account or a form of stored value, declared Al Mansouri. "In this context, these regulations do not apply to bitcoins or other crypto-currencies, currency exchanges or underlying technologies such as Blockchain."

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As such, it remains to be seen whether the governor's critical view of bitcoin has a local impact on the fledgling cryptocurrency industry.

The UAE saw its first Bitcasis bitcoin exchange launched late 2016, led by a Jordanian entrepreneur woman in Dubai. The exchange, which also offers a bitcoin portfolio available to users in the Middle East, North Africa and parts of Asia, secured start-up funding earlier in 2016 before launch and continues. its intention to be the first company in the MENA region (Middle East, North Africa).

Al Mansouri's remarks about bitcoin, while predictable, contrast with those of his Singaporean counterpart earlier this week. Ravi Menon, chief executive of the Monetary Authority of Singapore (MAS), said the central bank would keep "open-minded" with crypto-currencies like bitcoin, adding that "the currency itself does not presents no risk justifying the regulation ".


[I] t is a known fact that cryptocurrencies are often abused for illicit financing purposes, so we want to implement AML / CFT controls. These requirements therefore apply to the activity around the cryptocurrency, rather than the cryptocurrency itself.

Image from Shutterstock.