As digital currency still faces the challenge of wide acceptance from various authorities and countries around the world, including consumers, the risks of Bitcoin for example, were highlighted as a public alert to Quebeckers from the Autorité des marchés financiers (AMF), Quebec’s regulator, as Bitcoin ATMs were just rolled out in parts of the Canadian province.
The alert, posted this Wednesday on the AMF’s website, cautions residents of Quebec to acknowledge that cryptocurrency such as Bitcoin are not covered under its Financial Services Compensation Fund or the Deposit Insurance Fund, typically applicable to traditional investments in the region.
Bank Indonesia Says Bitcoin Not Currency or Legal Tender
The news was followed by Bank Indonesia, the central bank of Indonesia, which rather than just warn of the risk – took a position saying bitcoins and digital currencies are not legal tender, and said, “Bank Indonesia states that Bitcoin and other virtual currency are not currency or legal payment instrument in Indonesia,” according to an official press release it issued yesterday.
In addition, the statement from Bank Indonesia said, “The society is encouraged to be careful toward Bitcoin and other virtual currency. All risks related to the ownership/use of Bitcoin should be borne by the owner/user of the Bitcoin and other virtual currency.”
AMF to Take Action
The financial markets’ regulator said it’s closely monitoring the recently introduced virtual currency in Quebec as it applies to the Securities Act, Derivatives Act, and the Money-Service Businesses Act, and how it would take action in the event of violations under any of these statutes, according to the press release.
Separating Yourself From the Pack in a Mature FX IndustryGo to article >>
Also noted was how the allure to Bitcoins could serve as a conduit for fraudsters to set up Ponzi schemes or other scams to lure investors, and that it could be used to facilitate fraudulent transactions, just as traditional hard currency (and paper currency) can.
The AMF last warned about Forex in October after Quebec residents had fallen victim to a fraud, as reported previously.
Digital Currency Gets Mixed Welcome
Forex Magnates’ related publication, Payment Magnates, has just covered that Apple’s iTunes store removed BlockChain.info’s App from its market place, an app used for a number of Bitcoin related transactions and research, including storing the digital currency in a Bitcoin Wallet offered service. This followed Apple’s removal of other related Bitcoin wallet services.
Meanwhile, New York State appears to have embraced the positive prospects of such currencies, following a meeting of state officials just weeks ago discussing the regulations under “Bitlicenses,”and as NY got its first Bitcoin ATM.
On the other side of the globe, BTC China was said to have resumed operations following a re-interpretation of applicable regulatory guidance, and after a number of central banks and countries took positions on whether to support or resist the emerging digital currency proliferation.
Forex Magnates’ research indicates that more brokerages and financial institutions will continue to incorporate related offerings and services involving cryptocurrencies, or Altcoins (alternative coins), in addition to Bitcoin related transactions, whether for speculating on their price, owning them, or using them as a medium to buy/sell other investments.