Cryptocurrency Not To Be Considered 'Legal Tender'; Centre To Treat It Like Stocks & Bonds
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Legal Tender? The Regulation of Cryptocurrencies
Cryptocurrencies will never become legal tender
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Demystifying Crypto: Digital Assets and the Role of Government
Cryptocurrencies not recognised as legal tender in Malaysia, says deputy minister
Useful assets:Although digital assets are not recognised as legal tender, Yamani added
it still has many different usage including as a class asset that can
be invested in
Cryptocurrencies are still not recognised as legal tender in Malaysia as they do not exhibit characteristics of universal money, says Deputy Finance Minister II Yamani Hafez Musa.
Yamani said cryptocurrencies, also known as digital assets, are also not a payment instrument that is regulated by Bank Negara. `
“Digital assets such as bitcoin and Ethereum are not suitable to be used as a payment instrument as these assets do not exhibit characteristics of money. `
“In general, digital assets are not a store of value and a good medium of exchange. `
“This is due to the state of digital assets which is exposed to volatility as a result of speculative investments,” he said when replying to a question raised by Nurul Izzah Anwar (PH - Permatang Pauh) in Dewan Rakyat on Thursday (March 3). `
Nurul Izzah had asked about the government’s role in monitoring and regulating currency as well as cryptocurrency assets. `
She also asked if the government had any plans to create digital currency taking into account Bank Negara’s involvement in Project Dunbar for international money transfers using blockchain technology. `
In explaining the volatility of cryptocurrency, Yamani said bitcoin hit a peak of US$65,000 (RM272,382.50) in April 2021 but quickly saw a decline of 50% the following week. `
He also said cryptocurrency is exposed to the risk of theft in which statistics from 2011 to 2021 showed that digital assets worth US$12bil (RM50.29bil) have been stolen through cyberattacks and hacking. `
He added that bitcoin is also only able to process 10 transactions per second compared to 65,000 transactions per second on current payment systems such as Visa. `
“Also, what is important is the huge impact on the environment because the electrical power that is used to process one bitcoin transaction can process 1.2 milliob visa transactions. `
In 2020, the bitcoin network used 132 terra-watts per hour which is equivalent to the entire electricity consumption of Argentina,” he said. ` Yamani added that currently, Bank Negara has also not decided to issue a central bank digital currency (CBDC) as the country’s domestic payment systems including the Real-time Retail Payments Platform continues to operate safely and efficiently to support Malaysia’s economic needs and allows real-time digital payments. `
“Additionally, the monetary policy tools and existing finances also remain effective in maintaining monetary stability and the country’s finances,” he said. `
Although digital assets are not recognised as legal tender, Yamani added it still has many different usage including as a class asset that can be invested in. `
As such, he said the Securities Commission (SC) as the market regulator has set digital assets as a security under the law and is responsible to regulate its trading activities.-
China's Bitcoin trading has plunged to 10 percent of global share from 90 percent, and the country has effectively curbed the speculation of crypto currency trading as part of an effortto fend off domesticfinancial risks and restore financial order, the central bank said on Thursday.
Sting operation on bitcoin-mining power theft racket nets 18 suspects
Eighteen people have been arrested in relation to the bitcoin mining syndicate busted by a joint sting operation involving Tenaga Nasional Bhd (TNB) and the Malaysian Anti-Corruption Commission (MACC).
Open sesame A fireman breaking open a reinforced door at one of the Bitcoin mining centres. The raiding team had to break two more such doors before they could enter the premises. `
Electricity stealing spree comes to an end as Macc finally takes action
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In the three years that MACC officers posed as TNB meter readers, they were paid a whopping Rm2.4mil in bribes. The Bitcoin mining syndicates were raking in much more – about Rm50mil a month – but this is about to end soon. JAYA: It was a sting operation that began three years ago during which time MACC officers disguised as TNB meter readers were paid Rm2.4mil in bribes. `
Some were even offered Bitcoin – a first for graft busters – to turn a blind eye to the power theft by mining syndicates. `
The masterminds could afford this. They were raking in a whopping Rm50mil a month from their 1,000-odd premises nationwide. `
Yesterday, the anti-corruption officers crippled much of their activities by conducting simultaneous raids in Malacca, Negeri Sembilan, Kedah, Penang, Kuala Lumpur and Selangor. But it wasn’t easy. `
“It took us an hour to break open two doors at each premises,” a source close to the investigation revealed. `
“And then, there were three more vault-like doors to cut through before we could enter one of the premises,” the source said. `
“We had to seek the help of the Fire and Rescue Services.” `
Dozens of suspects were arrested, including the heads of the syndicates. More than 200 Bitcoin mining machines were also seized in yesterday’s raids that involved dozens of Tenaga Nasional officers. `
“Some 350 MACC officers were involved in the probe,” said the source. `
While it is not illegal to mine Bitcoin, power theft is. `
This is done because running such an operation requires dozens of computer servers that would be in operation around the clock. `
“This would require huge amounts of electricity,” said the source. `
“The amount of electricity stolen at each premises could amount to RM40,000 per month,” added the source, saying that the syndicates earned around RM50,000 from every premises. `
“If they had paid their electricity bills, they could still make a profit because most of them own dozens of premises each,” the source explained. `
“But, greed got the better of them.” `
Bitcoin mining uses sophisticated computer software to try to solve complex mathematical problems to unlock a “key” that will enable a new Bitcoin to be produced. `
The Bitcoin market is highly volatile. Its value fluctuated from RM160,000 to RM277,000 in a month. `
A MACC spokesman confirmed yesterday’s raids. `
Yesterday, The Star reported that Bitcoin mining operators were reaping in millions at the expense of the public. `
Local communities, including hospitals, that shared the same power source as the mining premises, were being deprived of supply. `
Some buildings located near the Bitcoin mining premises experienced power outages often, with some burning to the ground. `
It is understood that the graft busters began the sting operation following a sharp increase in losses incurred by the country due to electricity theft. `
“Each premises owns around 80 to 120 Bitcoin machines. `
“They bring in these machines from China via Port Klang. They declare it as computer equipment,” the source said. `
Investigations are being conducted under Sections 16 (b) and 17 (b) of the MACC Act 2009 and if convicted, the guilty face a maximum imprisonment of 20 years and can be fined not less than five times the value of the bribe or RM10,000, whichever is higher. `
On Jan 24, Energy and Natural Resources Minister Datuk Seri Takiyuddin Hassan said the country lost more than Rm2.3bil in bitcoin mining activities – an increase of 400% over the past four years. `
By ALIZA SHAH alizashah@thestar.com.my
Bustingbitcoinbribers
On the watch: A TNB officer checking on a bitcoin mining premises.
`MACC zeros in on miners who pay meter readers to look the other way
PETALING JAYA: Bitcoin mining operators running their operations on stolen electricity and bribing electricity meter readers to help them hide their actions will soon have to pay the piper. `
The Malaysian Anti-corruption Commission (MACC) is zooming in on them and their crime which is causing financial losses in the billions of ringgit. `
“Graft-busters have been looking at dozens of such operators and they are expected to make their move anytime now,” revealed sources with knowledge of the investigation. `
It is learnt that these operators, who have branched out to every state in Malaysia, are even willing to pay up to a quarter million ringgit as bribes to meter readers to look the other way and give them a miss. `
While it is not against the law to mine bitcoin, running such operations requires dozens of computer servers working on a 24-hour basis, which requires huge amounts of electricity. `
Many are not paying their dues and are instead stealing electricity by illegally tapping into power sources or tampering with the meter. `
In an interview with The Star, sources said that in addition to cash, these syndicates even offered bitcoin, or cryptocurrency, as bribes. `
The authorities, they added, kickstarted their on-ground investigation a few years ago following the sharp increase of losses incurred by the country due to electricity theft by bitcoin miners. `
It is understood that the investigations are currently being conducted under Sections 16 (b) and 17 (b) of the MACC Act 2009, which stipulates that giving or offering bribes is equal to the offence of accepting bribes. `
If convicted, the person faces maximum imprisonment of 20 years and can be fined not less than five times the value of the bribe or RM10,000, whichever is higher. `
However, enforcers face several challenges in thwarting these illegal activities, especially since these premises are usually as tightly sealed like as a war-time bunker. `
On Jan 24, Energy and Natural Resources Minister Datuk Seri Takiyuddin Hassan said the country had lost more than Rm2.3bil in bitcoin mining activities – an increase of 400% over the past four years. `
The number of cases has also drastically increased year-on-year. `
In 2018, there were 610 cases while there were 1,043 cases in 2019, 2,465 cases in 2020 and 3,091 cases in 2021, totalling 7,209 cases. `
By ALIZA SHAH alizashah@thestar.com.my
Syndicate’s greed ravaging local communities
Fire hazard: The energy intensive mining activities of bitcoin machines that run 24/7, can lead to power outages, damage to electrical appliances and worse – potential fires.
— Photo courtesy of TNB
PETALING JAYA: Bitcoin mining operators running on stolen electricity are reaping in millions at the expense of the public. `
Sources said the syndicates behind the operations were depriving the local communities – including critical sectors such as hospitals which shared the same power source – of their supply. `
The energy intensive mining activities of bitcoin machines that run 24/7, can lead to power outages, damage to electrical appliances and worse – potential fires. `
“Each premises is loaded with mining machines and the operators rely on air conditioning to help cool the equipment. `
“So, their electricity bills can go up to RM40,000 per month for each premises but their profit is just slightly above the amount.
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“That is why they have no choice but to operate using illegal sources (of electricity),” the sources told The Star. `
The Star learnt that some buildings located near these bitcoin mining premises had experienced power outages, with some even burning to the ground. `
“These bitcoin mining premises often use fuses that do not adhere to safety standards and load, exceeding the capacity of the cables. So, unfortunately for their ‘neighbours’, when the fire breaks out, they are also affected. `
“There were instances where reports were lodged over power outages at dialysis centres and clinics and upon investigation, authorities found that these were due to bitcoin mining premises illegally tapping into the power,” said the sources. `
It is understood that some of these bitcoin mining operators own hundreds of premises. `
“Bitcoin mining” is a process of using sophisticated computer software to try to solve complex mathematical problems to unlock a “key” to produce a new bitcoin. `
The first bitcoin miner to solve the puzzle is rewarded with a bitcoin. `
Only one miner can add a new block to the blockchain every 10 minutes by solving the puzzle and to maintain a competitive advantage, many operators would scale up or upgrade their equipment to run round the clock. `
A study in the United States suggested that a single bitcoin transaction required 2209.41 kilowatt per hour (kWh), which was equivalent to 75.73 days’ worth of power consumed by an average household in the country. `
The bitcoin market is highly volatile, with its value having fluctuated from more than RM277,000 in October to over RM160,000 this month.
Tools of the trade: (From left) energy
commission ceo abdul razib dawood, azam and Baharin looking at the
seized computer hardware at the Macc headquarters in Putrajaya.
18 nabbed and rm4.5mil frozen after three-year Op Power
The masterminds behind a multimillion ringgit bitcoin mining syndicate
are among 18 individuals arrested by the Malaysian Anti-corruption
Commission (MACC), following a threeyear sting operation codenamed Op
Power.
MACC chief commissioner Tan Sri Azam Baki said the 18 individuals arrested are all Malaysian males aged between 30 and 60.
“We confiscated 1,157 bitcoin (mining) machines worth Rm2.3mil in total.
“A total of Rm4.5mil was frozen from bank accounts linked to 94 individuals and 29 companies.
“The MACC also seized RM281,180 in cash, RM82,000 in ewallet balances and some US$25,893.46 worth of cryptocurrencies.
“Five vehicles, including a BMW, Toyota Vellfire and an Audi, have also
been seized,” said Azam at a press conference at the MACC headquarters
here.
Azam added that the MACC is looking to arrest another five individuals
with links to the case, but this has been put on hold as the suspects
have currently tested Covid-19 positive.
The Star on Sunday and Monday reported on a sting operation that began
three years ago during which MACC officers posing as TNB meter readers
were paid Rm2.4mil in bribes.
Azam said the syndicate operators offered between RM3,000 and RM300,000 to TNB officers to help cover up their operations.
The syndicate was found to have used special devices to manipulate
power usage to ensure that their operations used as little electricity
as possible.
Azam said that while cryptocurrency mining is not illegal, power theft is a crime.
TNB chief executive officer Datuk Baharin Din, who was also
present at the press conference, said the syndicate used sophisticated
methods for their illicit operations.
“The quantum of the power volume that this syndicate has stolen is
very large, and it was done continuously for 24 hours and 365 days.
This went on for over three years.
“The technique the syndicate used to tamper with the power usage is quite sophisticated.
“You come across small households that try to steal power, but these people go way beyond that.
“To do what they did, you have to be very competent.
“So we are very thankful to the MACC for their big help in this
operation and because of them, we managed to stop this syndicate,” said
Baharin.
China's State Council Information Office on Monday issued the Report on Human Rights Violations in the United States in 2021. The report said the human rights situation in the US, which has a notorious record, worsened in 2021 as political manipulation led to a sharp surge in COVID-19 deaths, and shooting deaths in the country hit a new record. `
The report revealed that despite having the world's most advanced medical resources, the US has the biggest number of COVID-19 infections and deaths globally. But the US government isn't rethinking its approach and still lacks effective anti-epidemic plans. Instead, it stoked the origins-tracing of COVID-19, and has been keen on passing the buck, shifting the blame and political manipulation. `
The public security situation in the country also deteriorated and violent crimes remained prevalent. There were 693 mass shootings in 2021, up 10.1 percent from 2020. More than 44,000 people were killed in gun violence, according to the report.
US human rights violations in 2021. Graphic: GT
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The report also highlighted the country's growing discrimination against ethnic minority groups, especially people of Asian descent with around 81 percent of Asian American adults saying violence against Asian communities is rising. `
Unilateral US actions created new humanitarian crises across the globe, the report noted. A US drone strike during US' withdrawal of troops from Afghanistan killed 10 members of an Afghan family, including seven children, among which the youngest was only two years old. `
The report pointed out that in 2021, the US public persona of "human rights defender" was totally debunked as the so-called "Summit for Democracy" under the guise of safeguarding human rights became a farce. At the 48th session of the United Nations Human Rights Council, many countries blasted the US for being the "biggest destroyer" of human rights in the world and urged the country to address its own human rights violations. `
It's universally acknowledged that the US has a big human rights problem. The problem is characterized by racial discrimination, the lack of respect for the disadvantaged, the disparity between the rich and the poor, and the number of shooting deaths every year, Li Haidong, professor at the Institute of International Relations of the China Foreign Affairs University, told the Global Times on Monday. `
So when the US talks about human rights issues in other countries, it must have a clear understanding of its own human rights situation, Li urged. But the tragedy is that the politicians in the country always turn a blind eye to US' poor human rights record and pretend to be "teachers on human rights" in the international community, said Li. He added that the US has no qualification and pointed out the fact is that chaos on human rights in other countries and regions have often been brought by the US. `
On the human rights issue, the US should learn to communicate with other countries and regions on an equal footing, instead of imposing its own standards on them, Li urged. `
Chinese observers also criticized the US of weaponizing human rights to smear and attack other countries and regions, saying it is a despicable act.
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