The central bank of Indonesia has been observed sending numerous supervisors out for the purposes of making sure that the domestic financial institutions adhere to the ban imposed on crypto-based payments. The institutions need to provide proof regarding the nationwide ban and whether they are abiding by it or not. The ban pertains to payments made in cryptocurrencies during the current bull season.
As cryptocurrencies become increasingly popular, more and more countries are scrambling to implement tighter restrictions and regulations. However, others such as El Salvador have adopted an open-minded and progressive approach instead.
Supervisors being mobilized
Perry Warjiyo, the central bank’s governor, is busy mobilizing numerous official supervisors in an effort to enforce the nation’s aforementioned ban on utilizing cryptocurrency as a form of payment by the country’s financial institutions.
It had been via a digital seminar a couple of days ago that Warjiyo had emphasized that the domestic financial organizations along with the local payment providers are not allowed to facilitate the usage of any cryptocurrency for the purposes of settling payments, nor are these institutions permitted to use crypto for any other related financial service.
This was due to the fact that as of this moment, cryptocurrencies are still not considered as legal tender nor ‘legitimate instruments for payment under the country’s constitution, Currency Law and Bank Indonesia Law.’ The field supervisors shall hence be deployed in order to guarantee that no institution will participate in anything even remotely related to cryptocurrencies.
Future of crypto in Indonesia
The initial prohibition had come back in 2017, as the central bank had made it clear that payment processors were no longer allowed to operate using crypto in order to settle various transactions. However, just a few years later, in 2019, the country’s CFTRA (Commodity Futures Trading Regulatory Agency) had issued different regulations through which cryptocurrencies were authorized to act as speculative assets. This made it possible for the trading of crypto derivates on domestic stock exchanges to occur.
Furthermore, the ban on crypto could also coincide with the imminent launch of the nation’s own CBDC, which had been announced on the 25th of May last month. Regarding the CBDC’s details, it had been revealed that Indonesia’s digital currency should be advancing the country’s monetary goals as well as adhering to the policies regarding digitization.
As per the Bank for International Settlements, we can assume that various central banks will most likely end up launching CBDCs as early as within the time span of the next three years.