UNAIR NEWSÌý“ A problem arises, cryptocurrency does not comply with sharia principles.ÌýEven in Egypt, the government banned the full use of this cryptocurrency.ÌýThe development of Cryptocurrency is too fast and we have to know exactly how central banks will respond to this Cryptocurrency.
Can the risks be minimized, so they can comply with sharia principles and be used in transactions?
Development of digital economy brings growth to the economy as well as the lifestyle of Indonesian people.ÌýIslamic economics and finance have many opportunities that can be utilized to drive growth in the digital era.ÌýCryptocurrency is part of the development of digital technology with high volatility and potential instability.
“Cryptocurrency has four characteristics potentially posing risks, Regulation,ÌýPeer to Peer,ÌýPseudonymity, No Control Authority,”Ìýsaid Jardine A. Husman, asÌýAssistant Direstor of Islamic Economics Department,ÌýBank Indonesia.
He explained, in an economic perspective Cryptocurrency does not meet three functions of money.ÌýThe volatility limits cryptocurrency, scale and networks that receive cryptocurrency is limited, limiting the use of Cryptocurrency as a medium of exchange, so far there is very little evidence that it is used as aÌýunit of account.
Cryptocurrency brings high risk in the payment system, convertibility risk. There is no guarantee exchanged forÌýfiat money,Ìýthere is no protection from investor.ÌýFinancial system stability, the risk of high volatility price because its value is determined in future supply and demand (speculative).ÌýIllegal activities,ÌýpseudonymityÌýof mechanism makes the transaction agent cannot be identified.ÌýConsumer protection, there is no clear management so it is difficult to ask for accountability if a problem occurs.
“Bank Indonesia’s policy and stance response warns the Ìýprocess of buying / selling or trading in Cryptocurrency (investment) because of the risk of money laundering.ÌýCryptocurrency is not recognized as a means of payment in Indonesia in accordance with the Currency Law, “he toldÌýUNAIR NEWSÌýviaÌýWhatsappÌý, on Thursday, October 19.
He said the response to Cryptocurrency was varied cryptocurrency regulation in various countries.ÌýIt is banned because it is susceptible to be used for crime and manipulation and brings risks to the stability of the financial system (Ìýbubble & fluctuating).ÌýIt is strictly regulated, especially in countries where the public’s understanding of technology and investment is good, using technology for national interest and not yet have aÌýclear stance.
“As in the Philippines, BSP aims to regulate the use of Cryptocurrency in financial services, especially payments and remittances that are considered to have a material impact on APU & PPT, consumer protection, and financial stability.ÌýSo thatÌýExchangeÌýmust have aÌýCertificate of Registration (COR),Ìýrisk management related to technology, internet control, and periodic reporting.ÌýWith authority of Bangko Sentral Ng Pilipinas (BAP), “he said.
Author: Rolista Dwi Oktavia
Editor: Nuri Hermawan
