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Indonesia’s central bank is reportedly planning regulation to enact a complete ban on cryptocurrencies like bitcoin.

Bank Indonesia (BI), the country’s central bank, is drawing up regulation to enact a sweeping ban on all forms of cryptocurrency, their trading and their usage in transactions as payments, according to Agus Martowardojo – the governor of the central bank. According to local publication Pikiran Rakyat, the central bank official made the revelation during the central bank’s annual meeting last week, claiming the crippling regulation was required to maintain the sovereignty of the rupiah [Indonesia’s fiat currency] as the country’s legal tender.

He went on to detail additional restrictive measures by the bank, stating:

We [will] also prevent arbitrage opportunities, unhealthy business practices and business controls by parties outside the legal reach of Indonesia’s laws that could damage the structure of industries here.

Digital currencies, the official said, are also potentially used [abused] for terrorism financing and money laundering. Martowardojo has now doubled down on the bank’s hostile stance toward cryptocurrencies after threatening bitcoin adopters in the country. In remarks earlier in October, the central bank chief said those using bitcoin as a payment method “will be dealt with.”

Further, the new rules – due to come out in 2018 – will also include financial technology (FinTech) companies and startups under its purview, according to the central banker.

Martowardojo’s remarks about a future ban on cryptocurrencies comes within days of Indonesia’s financial regulator urging retail investors to stay away from the ‘lure’ of cryptocurrencies.

According to CCN Indonesia, the chairman of Indonesian Task Force (SWI) under the Financial Services Authority, Tongam Tobing said last week:

We urge you to invest in logic, not Bitcoin, so people do not go there…People, if you want to invest, do not invest in virtual money, but invest in the legal [assets] that can improve the economy of Indonesia.

Featured image from Shutterstock.

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Posted by Samburaj Das