Laos’ notice to its citizens, on cryptocurrency trading and their usage

Laos’ notice to its citizens, on cryptocurrency trading and their usage

Following a notice dated 29th August that warned the public of using unregulated cryptocurrencies, specifically mentioning Bitcoin, Ethereum and litecoin. Laos’ central bank has published a cautioning notice to the public, warning them against cryptocurrency trading and usage as a means of payment.  The notice was directed to merchants, traders and residents, urging them to do research in order to understand digital asset before investing too much in it. The notice is expected to affect crypto- related investments in the area.

As stated by the Laotian Times, The central bank do not recognize cryptocurrencies as payment instruments, based on the law of payment system (last revised in November 2017) as they do not meet the specific standards set to classify it as a currency. Though the notice has warned the public on the risks involved in investing and trading in cryptocurrencies , as they are not yet regulated by any legislation in the country, nor  are they recognized in Lao law, businesses in the country are still accepting payment of goods and services in cryptocurrency.

Trying to make a distinguish between cryptocurrency and fiat currency, is a senior central bank official, that told Vientiane Times that cryptocurrency is not a real currency like Lao kip or Thai baht as its unable to pay debts. He says it’s just a digital record of a transaction. He added that since cryptocurrency is not yet regulated by law, people who will continue to be involved with it will be at risk if the system fails.

Vietnam, a country that neighbors Lao to the east has recently taken a more hostile path in its attempt to regulate cryptocurrency. Vietnam’s central bank issued a notice on October 2017 that outlawed cryptocurrency payment in the country with immediate effect. This took a stand on 2018 whereby Bitcoin adopters stood to be fined up to $ 9,000 and also could face criminal prosecution. Imports of cryptocurrency miners have also been suspended by Vietnam Government.

On the other hand, Thailand, which is also Laos’ neighbors are gracefully embracing cryptocurrency markets and initial coin offering. In order to regularize ICOs and cryptocurrencies, Thailand security regulators on July published regulations notably approving seven cryptocurrencies which operators may receive payment in. This are; Bitcoin, Ethereum, Ripple, Bitcoin Cash, Ethereum Classic, Stellar and Litecoin. Laos would do quite well if they could borrow a leaf from them.

Apart from the public notice warning Lao citizens from investing in cryptocurrency,there is no explicit ban on cryptocurrency trading domestically.