Luno: No operation nod yet

The UK-based company is already facing operational challenges locally

By AFIQ AZIZ

Luno has no knowledge of any approval accorded by the Malaysian authority for cryptocurrency exchange to operate in Malaysia.

The UK-based company, one of the earliest bitcoin exchanges in the world, is already facing operational challenges in Malaysia. Its local entity BitX Malaysia Sdn Bhd’s account has been frozen by the Inland Revenue Board (IRB) following investigation into tax-related matters.

Werner van Rooyen

Werner van Rooyen (Source: Luno)

Luno head of marketing and communications Werner van Rooyen said Luno has no information on the matter and the company has not issued any statement related to any such approval.

He told The Malaysian Reserve (TMR) that any approval should be clarified by the authorities in Malaysia. Van Rooyen was asked on speculations that Luno will be allowed to operate in Malaysia. Luno had said that the exchange would continue to work with the IRB in relation to its accounts and tax issues. “As we have mentioned, the fact that ours is such a new and mostly unregulated industry means the authorities often

lack precedent or guidance. “(Thus) Luno is working closely with the IRB to help them better understand both Luno and the industry more broadly — how digital currency platforms like Luno work, how the market is using digital currencies, and how other countries are proposing regulation,” Luno said, adding that the authority understands that the investigation process

will impact Luno’s clients. South Korean tax authorities recently have also taken similar move, forcing the country’s exchanges including Bithumb, Coinone and Korbit to be removed from cryptocurrency price tracker, Coinmarketcap.com. TMR recently reported that Luno has confirmed plans to open its office in Kuala Lumpur in the first quarter of this year.

It is, however, not known how the tax issue will impact the digital token exchange’s plan in Malaysia.

Monetary authorities in Malaysia and many other countries are trying to find ways to regulate the obscure, yet popular digital token, which had taken the financial world by storm. Authorities are trying to protect the consumers’ interest, and worry excessive speculations related to digital token will result in massive losses for investors.

A bitcoin and ethereum Singaporean-based developer, Peter Macaulay said the recent update would require Luno to speed up the cooperation and comply with Malaysian authority guidelines.

“If they (Luno) are going to open an office, they should be working quickly to comply (with the regulators),” Macaulay told TMR.

But, Luno said it was trying to resolve the issue with the Malaysia’s tax authority, and van Rooyen said the company will work closely with IRB to limit the parameters of its broad request to protect its customers’ personal information.

National ICT Association of Malaysia research committee chairman Woon Tai Hai said cryptocurrency players can expect more direct intervention from authorities.

“Given that ample warnings by regulators on the risks and volatility of cryptocurrency trading, the pace of the global cryptocurrency still seems to be continuous on an upward path.

To curb this further, more regulator’s direct interventions are anticipated in coming months,” he told TMR.

“With more direct interventions from the authorities, cryptocurrency trading, including ICO (initial coin offering) activities, will further be cur- tailed, at least in Malaysia.

“However, these measures will not deter enthusiastic investors from buying from offshore centres like Singapore,” Woon said.

The authority recently had halted the introduction of a Singapore-based ICO, Copy-CoinCash, in Malaysia early this month.