Sri Lanka Forms Committee For Blockchain Implementation And Crypto Mining

Sri Lanka has identified the need to develop blockchain. (photo: doc. unsplash)

JAKARTA – Sri Lanka is joining the global crypto adoption drive after forming a committee to explore and implement blockchain technology and crypto mining.

A letter shared on October 8 by the Sri Lankan government's director-general of information, Mohan Samaranayake, indicated that the authorities had approved recent proposals aimed at attracting investment in blockchain and cryptocurrency initiatives in the country.

According to Samaranayake, Sri Lankan authorities have identified the need to develop an “integrated system of digital banking, blockchain and cryptocurrency mining technologies” as a means to stay on par with global partners and international markets.

“This committee will be mandated to study regulations and initiatives of other countries such as Dubai, Malaysia, Philippines, EU, and Singapore, etc., and propose a suitable framework for Sri Lanka,” Samaranayake said, quoted by Cointelegraph.

The proposal was made by Namal Rajapaksa, the coordinating minister, and project monitoring, which requires the committee to report crypto and blockchain-related findings to the Law, Rules, and Regulations Cabinet.

Of the eight-member committee, two represent international fintech giants including Sandun Hapugoda of Mastercard and Sujeewa Mudalige of PricewaterhouseCoopers (PwC). Members of traditional finance include Colombo Stock Exchange CEO Rajeeva Bandaranaike and Sri Lankan Central Bank director Dharmasri Kumarathunge.

The remaining four members represent various national authorities including the Sri Lanka Computer Emergency Readiness Team (SLCERT), Department Of Government Information, Information and Communication Technology Agency (ICTA), and the President's Council.

To support this initiative, the committee will also monitor laws and regulations implemented by other countries to establish rules against Anti-Money Laundering (AML), terror financing, and criminal activities.

A recent Cointelegraph report highlighted a 706% spike in cryptocurrencies in Central and South Asia and Oceania between July 2020 and June 2021. Based on data shared by Chainalysis, the value of transactions in the region amounts to 14% (USD 572.5 billion or IDR 8.1 quadrillion), where India represents the highest global transaction value.

Back in April, Sri Lanka's central bank issued a public notice against the risks associated with investing in cryptocurrencies, citing a lack of legal or regulatory assistance. However, just a month after the notification, the central bank selected three banks to develop a proof of concept for a shared Know Your Customer facility using blockchain.