Bank Indonesia, the country’s central bank, is reportedly considering issuing central bank digital currency (CBDC) to combat the use of cryptocurrencies. “A CBDC would be one of the tools to fight crypto. We assume people would find CBDC more credible than crypto, ”said a deputy central bank governor.
Central bank sees CBDC as a tool to “fight crypto”
Juda Agung, a deputy governor of Bank Indonesia, the country’s central bank, spoke about cryptocurrency and central bank digital currency (CBDC) during his parliamentary “fit-and-property test” to become deputy governor of the central bank.
He said Bank Indonesia plans to issue a digital rupiah to be used as legal tender to fight cryptocurrency, Bloomberg reported, noting that the central bank has been investigating the issue since the beginning of the year.
In Indonesia, crypto assets are traded alongside commodity futures and regulated by the Ministry of Commerce, the deputy governor said. However, he stressed that they have a significant impact on the country’s financial system, stating:
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.
According to the Ministry of Commerce, around 7.4 million Indonesians invested in crypto assets in July, double the previous year. Their crypto transactions totaled around 478.5 trillion rupiah ($ 33.3 billion). The Indonesian government is pushing plans to set up a dedicated crypto exchange.
The Indonesian Ulema Council (Majelis Ulama Indonesia or MUI), the leading Islamic body in the country that has the authority to uphold Sharia law, recently announced explained the use of the cryptocurrency haram, which is prohibited for Muslims under Islamic law.
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Source: Crypto News Austria