Bank Indonesia Wants To Use Its CBDC To ‘Fight’ Crypto, According To Report
The central bank of Indonesia believes that a CBDC as a much better financial tool than private, unregulated cryptocurrencies. They see CBDC as a way to go against private digital assets.
Bank Indonesia, the central bank of the country have been publish with its intentions to launch a central bank digital currency (CBDC) earlier this year. In May, Governor Perry Warjiyo said that it is on its way but a specific launch date has not yet been announced.
The bank has said that during the COVID-19 pandemic, locals have switched from cash to digital payments. As such, a CBDC monitored and controlled by the authorities would be the best option for that monetary transition.
According to a recent Bloomberg report, Bank Indonesia now has another reason to issue a digital rupiah: to “fight” cryptocurrencies which cause a significant impact on the nation’s financial network.
Juda Agung, Assistant Governor at the bank, said that a CBDC is a more reliable option than bitcoin and the rest of the private digital assets:
“A CBDC would be one of the tools to fight crypto. We assume that people would find CBDC more credible than crypto. CBDC would be part of an effort to address the use of crypto in financial transactions.”
The Indonesian government has plans to create a dedicated digital asset exchange by the end of 2021. Indonesia has more than 7 million crypto investors, while transaction value has surpassed $30 billion. In comparison, nearly twice fewer locals invested in the space in 2020.
Crypto Is Haram (Unlawful) In Indonesia
Recently the National Ulema Council (MUI), Indonesia’s top Islamic scholar’s body, took a highly negative stance on cryptocurrencies by declaring all operations in the industry as “haram,” or unlawful.
Asrorun Niam Soleh stated that the rejection ignites from the thesis that bitcoin and the alternative coins are riddled with “uncertainty, wagering, and harm.” Nonetheless, the MUI’s Fatwa Commission Chairman explained that digital assets can be traded as a commodity if it obeys the Shariah law and shows a “clear benefit.”
A country with a population of more than 273 million, Indonesia is known as the most populated Muslim-majority nation. Having that said, the development migt have a significant effect on the local cryptocurrency ecosystem.
