Sri Lanka moves to strengthen regulatory framework
Sri Lanka is taking significant steps to establish a comprehensive regulatory framework for Virtual Asset Service Providers (VASPs), as authorities work to align the country’s digital asset sector with international standards and best practices.
The fourth meeting of the VASP Sub-Committee was held at the Central Bank of Sri Lanka on May 25, 2026, under the chairmanship of Deputy Minister of Digital Economy Eranga Weeraratne. The meeting focused on advancing efforts to create a formal, transparent, and internationally compliant regulatory structure for virtual asset-related activities in the country.
Among the key matters discussed were the latest developments in Sri Lanka’s Financial Action Task Force (FATF) Mutual Evaluation process, proposed amendments to the Financial Transactions Reporting Act, and the designation of the Securities and Exchange Commission of Sri Lanka (SEC) as the lead regulator for virtual assets. Participants also reviewed plans to formalize the policy decision through a Cabinet Memorandum, paving the way for the implementation of a structured regulatory regime for the sector.
The meeting further considered the preparation of a Cabinet Memorandum accompanied by a concept paper aimed at establishing a comprehensive legal and policy framework governing virtual assets. Discussions highlighted the need for expert working groups, broad stakeholder engagement, and the development of a transparent, systematic, and robust regulatory environment. Officials emphasized that a well-defined regulatory framework would enhance investor confidence, strengthen oversight mechanisms, and support the responsible growth of Sri Lanka’s emerging digital asset ecosystem.
Among those in attendance were Senior Advisor to the President on the Digital Economy Dr. Hans Wijeyasuriya, Secretary to the Ministry of Digital Economy Waruna Sri Dhanapala, Director of the Financial Intelligence Unit (FIU) of the Central Bank Dr. Subhani Keerthirathne, and representatives from several government agencies and regulatory institutions.
The initiative forms part of Sri Lanka’s broader efforts to modernize its digital economy and ensure compliance with international financial and regulatory standards.
Source: Daily News
