Bank Indonesia will issue its own digital currency for use by banks and payment service providers at the wholesale level, Bank Indonesia Governor Perry Vajiyo said in a July 21 briefing, according to Bloomberg. The “digital rupiah” will be a digital version of the national fiat currency, rather than a more complex cryptocurrency. “The principles of the digital rupiah will be the same as paper money, which will be the only legal tender for digital transactions in Indonesia,” Warjiyo said, adding that the central bank is also looking for solutions to make it…
Bank Indonesia will issue its own digital currency for use by banks and payment service providers at the wholesale level, Bank Indonesia Governor Perry Vajiyo said at a July 21 briefing. Bloomberg News.
The “digital rupiah” will be a digital version of the national fiat currency, rather than a more complex cryptocurrency.
“The principles of the digital rupiah will be the same as paper money, which will be the only legal tender for digital transactions in Indonesia,” Warjiyo said, adding that the central bank is also looking for solutions to enable it to be exchanged across borders.
Scheduled to be released by the end of this year
The conceptual design of the future digital rupiah is planned to be released by the end of 2022.
Bank Indonesia has been studying the possibility of launching its central bank digital currency since last year. The report states that its main purpose is to lead the global adoption of cryptocurrencies as a payment method.
Currently, various technical options and cybersecurity features of digital currencies are being explored. Once issued, it will be distributed to large banks and payment service providers, which will in turn sell the digital rupiah to smaller banking institutions for various retail transactions, the central bank said.
Other countries are looking into cross-border transfers using cryptocurrencies
Indonesia is not alone in the idea of ​​using digital central bank funds for cross-border trade. Australia, Singapore, Malaysia, the Philippines and South Africa are all considering or already experimenting with blockchain-based technology for cross-border payments.
The central banks of these countries said the goal of their collaboration is to develop a shared platform for international transactions using digital currencies issued by different countries to improve and speed up transfers and settlements.
