Samoa’s Central Bank Warns Cryptocurrencies Are not Legal Tender

The cryptocurrencies are not recognized as money and those who wish to promote them must have a license for a financial institution.

The Central Bank of Samoa has issued a public statement, warning that cryptocurrencies are not recognized as legal tender in the country and are not issued or regulated by the bank.

In addition to them not being accepted as currency, the bank says, investing in them is “very risky and speculative in nature”.

“People who invest in any of the cryptocurrencies do so at their own risk,” the bank statement said. “There is no guarantee that cryptocurrencies will be accepted as a medium of exchange, or will hold their value. The Central Bank does not currently endorse unregulated cryptocurrencies like bitcoin, Onecoin or any cryptocurrency that has been promoted in Samoa. Therefore, the Central bank does not encourage anyone to invest in any of them.”

The bank also warns that anyone who wants to promote cryptocurrencies is considered a financial institution, as per Samoa’s money laundering prevention legislation. “This means it must have a valid business licence issued in Samoa and is required to follow the Central Bank’s reporting requirements for Financial Institutions,” the bank clarifies.

Somewhat as an afterthought, the bank adds that despite its misgivings for cryptocurrencies, it recognizes the potential of the blockchain technology and is researching it.

The statement by the Samoa central bank is similar to that of many other central banks across the world in that it tries to warn residents of the risks of investing in a volatile and largely unregulated asset such as the cryptocurrencies, but the mentioning of the infamous Ponzi scheme Onecoin is intriguing.

Following the crackdowns against the scheme in numerous countries, including Germany, India and most recently China, the Onecoin scam has reached the shores of the Pacific nation and is trying to lure Samoans into the scheme.