Malaysia Imposes Restrictions On Cash Transactions: BTC To The Rescue?

Malaysia imposes harsh restrictions on cash transactions and this move could force more people to turn to bitcoin and other cryptocurrencies as a way of getting around such limitations. In our Bitcoin news now, we learn more about the country’s decision.

The government of Malaysia wants to impose harsh restrictions on cash transactions as per the local media platform The Star. According to the news, the move is a part of the efforts to combat money laundering in the country.  Datuk Abdul Rasheen Ghaffour who is the deputy governor of Malaysia’s central Bank Negara commented on the plan and explained:

‘’This is to address the abuse of physical cash used for illicit activities.’’

The economist from Malaysia Barjoyai Bardai believes that the proposed cash transaction limit in the country will boost the digital currency adoption in the near future. According to him, having such strong restrictions could become a catalyst that will push more people to adopt digital payment systems:

‘’When consumers get used to using digital currency, they will be more willing and encouraged to undertake business dealings, and so, business dealings can get bigger and have a positive impact on the economy in the form of a doubling and also business volume.’’

As in most parts of Southeast Asia, Bitcoin and other cryptocurrencies and their adoption continue to fair favorably. However, this trend has also been accompanied by fraudulent investment schemes and criminal activities. The police in the country announced the arrest of five people on Thursday (November 7, 2019) that are suspected of stealing 85 bitcoin ATMs.

While Malaysia imposes the cash restrictions, they don’t seem to understand that this decision will limit industries such as medical tourism, hotels, and merchants overall. The transactions routed via financial institutions will also not fall under the new restriction policy since banks already have robust anti-money laundering compliance requirements.

For Abdul Rasheen, the proposed plan will not have a huge impact on the average Malaysian household.
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According to the central bank executive, the studies have shown that a median household income of under $2,000 is far below the proposed limit in the country. The country is the latest in the row that plans to restrict the legal limit for cash transactions. As it was previously reported, Australia is also looking to cap cash payments at $10,000.