Amid economic and political turmoil, the Central Bank of Sri Lanka, or CBSL, has warned the public against crypto purchases due to the lack of regulatory oversight.<\/p>\n
In a Tuesday notice, the CBSL said it has not authorized or licensed any company in Sri Lanka to offer crypto-related services, including exchanges, initial coin offerings and mining. The central bank said the warning was in response to \u201crecent developments in relation to virtual currency usage,\u201d likely referring to the market downturn and significant volatility in the prices of cryptocurrencies like Bitcoin (BTC).<\/p>\n
Virtual currencies \u201c… are considered as unregulated financial instruments and have no regulatory oversight or safeguards relating to their usage in Sri Lanka,\u201d said the CBSL. \u201cThe public is therefore warned of the possible exposure to significant financial, operational, legal and security related risks as well as customer protection concerns posed to the users by investments in VCs.\u201d<\/p>\n
The announcement came amid inflation in Sri Lanka reaching more than 54% in June as the SBSL bank raised interest rates to 15.5%. According to data from the central bank, inflation is roughly 45% at the time of publication, affecting the cost of living for the 22 million people living in Sri Lanka. <\/p>\n
On Saturday, hundreds of protestors stormed Sri Lankan President Gotabaya Rajapaksa’s residence in Colombo, reportedly seizing 17.8 million rupees \u2014 roughly $50,000 at the time of publication \u2014 as well as taking control of the building, using the facilities and eating food in storage. Thousands of Sri Lankans have also taken to the streets of the capital city in protest of the government\u2019s response to the economic situation. Parliament speaker Mahinda Yapa Abeywardena said that Rajapaksa will be resigning on Wednesday.<\/p>\n