Bank Indonesia: Cryptocurrencies are personal commodities

Bank Indonesia (BI) said the cryptocurrencies have no regulatory basis in Indonesia which means not the official currency. The Central Bank of Indonesia declares the use of bitcoin and other digital currencies as a means of transaction prohibited within the Provider of Payment System Services (PJSP), but not prohibited if used outside the PJSP where the risk will be borne by the user.

Tinuku Bank Indonesia Cryptocurrencies are individual commodities

BI's Executive Director of the Payment System Policy Department, Eny Panggabean, said the transaction of cryptocurrencies is usually done by two collecting parties, but cryptocurrencies are not included in the legitimate transaction tool as regulated by BI.

"We forbid bitcoin to be transacted in PJSP, which means that if outside the PJSP is the user doing at their own risk. It is individual commodity," said Panggabean.

"Usually bitcoin transactions are bilateral and invested in each other. You are not forbidden to keep money there, just as you treat gold," Pangabean said.

Pangabean said the legal means of transactions are officially regulated in state legislation. Transactions allowed in Indonesia are only rupiah, while foreign currency can be exchanged in money changer, because the issuance of foreign money is done by each central bank.

CEO of Bitcoin Indonesia, Oscar Darmawan, said transactions in Indonesia are still very low compared to global bitcoin use, maybe not 5 percent. Especially when compared with transaction volume in Japan, South Korea and China.

"Cryptocurrency is a remarkable technological achievement. This is the currency of the future," said Darmawan.

Darmawan says the peculiarity of bitcoin is running in a decentralized system and all transactions are verified automatically without human intervention. The decentralization system also locks the supply and can not increase more than the specified.