Malaysia to Limit Cash Transactions in 2020

[Darker45]

(Image grabbed from https://www.busonlineticket.com/blog/petronas-twin-towers-the-landmark-of-kuala-lumpur)

The country is set to implement an unprecedented restriction on the use of cash.^[1] This is doubtless the first time that a country is to implement such bizarre measure to counter the abuse of cash. Somehow, this national policy is implying that cash, at least within the country, is being abused for various illegal activities.

While some business communities are against such drastic measure as it would certainly affect their day to day operation, an idea pops out that they could actually circumvent this policy by adopting the use of Bitcoin and other cryptocurrencies.^[2] An ordinary household in Malaysia is said to spend around 8,000 Malaysian Ringgit (RM) per month, way below the 25,000 RM limit. But still, a lot are clamoring to increase the limit as the current proposed limit is way to low.

Would you care to share your thoughts on this? Will this really be a window for significant growth of Bitcoin or crypto adoption in this Southeast Asian country?

Sources:
[1]

• https://www.channelnewsasia.com/news/asia/malaysia-to-impose-cash-transaction-limit-of-rm25-000-in-2020-12072710
• https://www.thestar.com.my/news/nation/2019/11/08/business-community-says-no-to-rm25k-limit
• https://www.thestar.com.my/business/business-news/2019/11/07/malaysia-to-impose-cash-transaction-limit-of-rm25000-next-year

[2] https://bitcoinist.com/bitcoin-usage-may-spike-following-cash-restrictions-in-malaysia/

[1714107435]

1714107435

[1714107435]

1714107435

[1714107435]

1714107435

[1714107435]

1714107435

[joniboini]

The limit is for physical cash transactions. If you need to transfer make more than 25K RM, then you need to do it electronically.[1] I don't think that's a huge problem for the people.

I'm not sure how they will monitor it though, maybe need to read the full policy draft.

[1] https://www.theedgemarkets.com/article/bank-negara-wants-cash-transactions-be-capped-rm25000-next-year

[blckhawk]

Interesting ideology, especially from a government standpoint. I also agree with the side of investors and business owners since their daily transactions would be capped and their profit as well. They might look into cryptocurrencies because even digital modes of payments by banks that use also fiat would be affected by such policy. And this could pose an increase in market demand, especially to Bitcoin since it leads the market and is much reliable than other alts.

[The Sceptical Chymist]

OP, first two things:  1) Please don't include huge, unnecessary pictures in threads like this.  It's really annoying.  2) You might want to move this to the Economics section, as it seems more relevant to Economics.

This is lousy news for Malaysia, and I'm not sure what the hell their government is thinking by doing this.

“This is to address the abuse of physical cash used for illicit activities,”

I mean, give me a break.  I know banks in the US have to report withdrawals of greater than $10,000 to the IRS or something like that, but they sure as hell don't limit the amount of cash you can spend.  It's our fucking money, after all.  You can probably tell that this article pissed me off, because I don't think any government should be limiting what people do with their own money, especially not for the reason quoted above.  Such limits are going to do nothing to stop illegal activities, and this might even prompt criminals to adopt bitcoin even more than they already do. 

Argh.

[hello_good_sir]

It makes sense though, doesn't it?

If we lived in a world where cash didn't exist, and our world only had fiat transactions via online payment methods, there is going to be no government in the world that would invent and try to implement cash. Why?

Because cash is literally the best thing criminals can ever have, even better than cryptocurrencies and privacy coins since it's fiat-based and fairly easy to smuggle.

I don't think this limits bitcoin traders that much, more of a blow to the big whales that deal with cash a lot, and I respect this from the government, it'll make crime harder to do.

[adaseb]

The banks don't report it to the IRS they usually report it to the Money Laundering Prevention team i think it's called something like FinCEN.

I had a friend who sold a car this way, the price was something like $11000 and the guy actually brought cash. They met up at a bank and the buyer had to fill out some form where the money came from and what-not and he never had any issues.

Most likely if this became a law then the buyer would just need to buy a money order first and then pay my friend. While he buys the money order most likely he will need to submit something to FinCEN so I don't see what purpose lowering the cash limit would do.

Very rare to buy a car for 5 figures with cash these days however so I don't see this being a big issue. Most stuff you buy with cash from like Craiglists will be way below the limit anyways.

[CryptoBry]

Would you care to share your thoughts on this? Will this really be a window for significant growth of Bitcoin or crypto adoption in this Southeast Asian country?

Malaysia has a big plan to go digital and this is can be the underlying reason for the limit of the use of the fiat money, of course aside from those cited in the said policy. Now, we are looking at this as a catalyst for the people to be adopting cryptocurrency as part of the digitalization of this country. How is this going to affect Bitcoin that remains to be seen. We are hoping that people will be looking to Bitcoin as a good alternative to the Malaysia ringgit in doing their digital transactions and even in usual day-to-day lives. I am not from Malaysia so I am just commenting here as an outsider.

[Kprawn]

What is this going to accomplish? The illegal crime syndicates have loads of people working for them and they can just use these people to do the

individual transactions on their behalf. How are you going to stop illegal transactions being done between criminals? Most drug trades are done on

the street with amounts much less than that. Let's say you want to buy a big item with illegal fiat, then you just arrange with the seller that you

pay him over a longer period and be done with that.    There are many ways to circumvent stupid laws like this and even doing it within these

laws. 

[Juggy777]

Somehow, this national policy is implying that cash, at least within the country, is being abused for various illegal activities.

Would you care to share your thoughts on this? Will this really be a window for significant growth of Bitcoin or crypto adoption in this Southeast Asian country?

Sources:
[1]

• https://www.channelnewsasia.com/news/asia/malaysia-to-impose-cash-transaction-limit-of-rm25-000-in-2020-12072710
• https://www.thestar.com.my/news/nation/2019/11/08/business-community-says-no-to-rm25k-limit
• https://www.thestar.com.my/business/business-news/2019/11/07/malaysia-to-impose-cash-transaction-limit-of-rm25000-next-year

[2] https://bitcoinist.com/bitcoin-usage-may-spike-following-cash-restrictions-in-malaysia/

This policy won’t work for long and people will openly revolt against such bizarre policies, I feel the Malaysian government should instead incentivise people to use digital money instead of curbing fiat money. I don’t think we will see a major surge in bitcoin usage because many people don’t understand how to use it, and others will prefer to pay via online banking only.

[kawetsriyanto]

Will this really be a window for significant growth of Bitcoin or crypto adoption in this Southeast Asian country?

Do you see any correlations between "the limitation of the physical cash transactions" and "Bitcoin or crypto adoption"?
I think they don't plan to consider Bitcoin or crypto adoption, they just plan to apply more digital transactions (online) since it can be easier to control by the government. However, this is a good sign that more countries consider using digital payment in the future. It is in line with the existence of Bitcoin and other crypto currencies.

[jootn2kx]

Well that's hardly going to help. Criminals will find a way, as they always do, and regular people and business owners are going to suffer because of it. It might be good for crypto, but that remains to be seen.

[tianglistrik]

Well that's hardly going to help. Criminals will find a way, as they always do, and regular people and business owners are going to suffer because of it. It might be good for crypto, but that remains to be seen.

Criminals will continue to have a way, maybe the country's government thinks about transaction data that can be traced and I think it can help to do a little security, maybe it can have an impact on digital currencies. but I think to realize it will take time to adopt these rules

[lobat999]

This policy won’t work for long and people will openly revolt against such bizarre policies, I feel the Malaysian government should instead incentivise people to use digital money instead of curbing fiat money. I don’t think we will see a major surge in bitcoin usage because many people don’t understand how to use it, and others will prefer to pay via online banking only.

This is an absurd idea that will ultimately prove unpopular with Malaysians as I assume there will be repercussions if they implement it since I understand this will be first in ASEAN.

Now I think this is not an effective solution to combat illicit activities because these offenders will always find a way to circumvent this process! I guess the best way to combat these illegal activities is to strengthen crime detection and law enforcement and impose much harsher penalties and laws that will discourage would be offenders.

[mersal]

I wonder how a country can put limitations for using physical money? How do they know if someone used more money then they mentioned? If this is to stop illegal activities then this is wrong step from government,if they do then it will be a good chance for the people to adopt crypto currency where no limitation,no restrictions.

[cutesgirl]

Well that's hardly going to help. Criminals will find a way, as they always do, and regular people and business owners are going to suffer because of it. It might be good for crypto, but that remains to be seen.

Criminals will continue to have a way, maybe the country's government thinks about transaction data that can be traced and I think it can help to do a little security, maybe it can have an impact on digital currencies. but I think to realize it will take time to adopt these rules

Malaysia want to limit cash transaction is bad ideas for their economic country, I think is not good ideas because limit cash transaction make many investor not reach much profit with their investment, after cash have limited in Malaysia maybe they will try for limiting with bitcoin or digital currency for investing and legal currency transaction.

[Vishnu.Reang]

It's not just Malaysia. Here in India, we have even more bizarre laws. Recently the government made it an offense to keep more than $3,000 in physical cash at home. They want to track each and every transactions and the anonymity offered by physical cash has been an obstacle for that. And already many of the countries have recalled the high-denomination banknotes.

[Clement Kaliyar]

The country is set to implement an unprecedented restriction on the use of cash.^[1] This is doubtless the first time that a country is to implement such bizarre measure to counter the abuse of cash. Somehow, this national policy is implying that cash, at least within the country, is being abused for various illegal activities.

If they are restricting hard cash are they implementing this to promote online transactions to have a record on all the transactions, these restrictions occurs when you are withdrawing money from the bank i believe.

While some business communities are against such drastic measure as it would certainly affect their day to day operation, an idea pops out that they could actually circumvent this policy by adopting the use of Bitcoin and other cryptocurrencies.

If the government is trying to implement something to restrict the cash flow do you think that you can overcome that by bitcoin, the government will restrict that kind of payment too if they are trying to bring down the illegal activities with money.

[Eclipse26]

Why do they have to limit their people from using or keeping their local currency? What are they trying to do? Avoid inflation? Avoid criminal activities? I don't think that's the solution for it. The government's job is to prevent crimes but not to make their people suffer. People will have a hard time adjusting that they might look for another way to have money without having to hold their physical cash. Crypto can be an option, but are there any prohibition with crypto in Malaysia?

[VanDeinsberg12]

Southeast asia is known for its potential in the eyes of investors as of now, maybe that is because the significant growth of singapore that could affect the neighbouring country to be more competitive and this approach made by malaysia to force their citizens into using cashless society is not a bad idea in my opinion. It is already predicted since long ago that our society will eventually become cashless and that could reduce logging for sole purpose of creating money I honestly cant see this as a bizzare thing.

[Wysi]

Why do they have to limit their people from using or keeping their local currency? What are they trying to do? Avoid inflation? Avoid criminal activities? I don't think that's the solution for it. The government's job is to prevent crimes but not to make their people suffer. People will have a hard time adjusting that they might look for another way to have money without having to hold their physical cash. Crypto can be an option, but are there any prohibition with crypto in Malaysia?

I think they might have planned something big and even I am wondering why are even to implement such a bizarre rule? What are the other options available for the citizens?  Because everyone will not be able to learn about crypto and it's not feasible to use it on daily life. I will not be wondering if they are planning to go completely digital and launch their own centralized digital currency.