Indonesia Central Bank Warns Against Bitcoin Use

Indonesia's central bank is the latest to warn against using bitcoin, saying it could even break national currency laws.

AccessTimeIconJan 16, 2014 at 10:22 p.m. UTC
Updated Sep 11, 2021 at 10:16 a.m. UTC
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The deputy governor of Indonesia's central bank has said using bitcoin breaks a number of the country's laws, news portal Kontan reported (in Bahasa Indonesia). He urged Indonesians to be cautious when dealing with payments in general.

Ronald Waas, the deputy governor, said using bitcoin in Indonesia contravened rules set out by Bank Indonesia, information and electronic transactions laws and currency laws. Kontan's piece also noted that Indonesia's currency laws state only the rupiah is legal tender.

"Using bitcoin for payments breaks these laws," Ronald was quoted as saying.

The Kontan piece also noted that Ronald strongly urged Indonesians not to use bitcoin as a mode of payment. Bitcoin is risky because the security of transactions using the digital currency is not guaranteed, the report continued.

On a positive note, Ronald admitted that Bank Indonesia did not have detailed policies in place to govern bitcoin and did not have any specific rule to bar bitcoin's use as a mode of payment. Ronald also disclosed that the central bank had started working with the Ministry of Communications and Information to study the use of cryptocurrency in Indonesia.

Kontan is a respected business and economics news brand in Indonesia. It is published as a daily newspaper and a weekly journal. It is owned by Kompas Gramedia Group, the country's largest media conglomerate. The daily paper had an expected circulation of 75,000 when it launched in 2009.

Indonesia and bitcoin

Bitcoin has had a slow start in Indonesia. A number of exchanges are on the scene there, but some are still in development and none offer market-based prices. The latest exchange, Bitcoin.co.id, for example, offers fixed prices for BTC in exchange for rupiah. At the time of publication, 1 BTC was selling for 10.74 million rupiah ($886.20) on the exchange.

According to Bitcoin.co.id founder Oscar Darmawan, the nascent exchange had a trading volume of just 5 BTC a day when CoinDesk interviewed him at the end of Dec.

Indonesia is the world's fourth most populous country, with nearly 240 million people. One of the opportunities for Indonesian bitcoin services providers is in facilitating small amounts of international remittances among a large migrant worker population spread across Southeast Asia.

Featured image: Yohanes Budiyanto / Flickr

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