Indonesia plans to issue a central bank digital currency

Bank Indonesia, the central bank of Indonesia, is planning to issue a digital currency to speed up payments.

The central bank is currently assessing which technology to use for its digital rupiah, governor Perry Warjiyo told a streamed news conference on Tuesday, according to a Reuters report. Once issued, the digital rupiah will be a legal payment instrument in Indonesia, alongside banknotes. But the central bank doesn't have a timeline yet on when it will issue it.

THE SCOOP

Keep up with the latest news, trends, charts and views on crypto and DeFi with a new biweekly newsletter from The Block's Frank Chaparro

By signing-up you agree to our Terms of Service and Privacy Policy
By signing-up you agree to our Terms of Service and Privacy Policy

Indonesia, Southeast Asia's biggest economy, has reportedly seen an increase in digital banking transactions during the COVID-19 pandemic. Per Reuters, the country's transaction frequency in digital banking platforms rose over 60% on an annual basis to more than 570 million times in April, while value increased 46% to reach nearly 3,114 trillion rupiah (almost $217.5 billion).

While cryptocurrencies as a payment method are banned in Indonesia, it's legal to trade them. Earlier this month, the government of Indonesia said it is planning to tax profit on crypto trades.

With today's news, Indonesia joins a list of Asian countries that are exploring a central bank digital currency or CBDC. Hong Kong, Thailand, and South Korea are all currently working towards launching CBDC pilot programs. China, which is ahead of most countries worldwide, is nearing the launch of the digital yuan soon.

About Author

Yogita Khatri is a senior reporter at The Block, covering all things crypto. As one of the earliest team members, Yogita has played a pivotal role in breaking numerous stories, exclusives and scoops. With nearly 3,000 articles under her belt, Yogita holds the records as The Block's most-published and most-read author of all time. Prior to joining The Block, Yogita worked at crypto publication CoinDesk and The Economic Times, where she wrote on personal finance. To contact her, email: [email protected]. For her latest work, follow her on X @Yogita_Khatri5.