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Indonesia central bank warns over cryptocurrencies

Reuters  |  JAKARTA 

(Reuters) - Indonesia's central has issued a fresh warning about trading in like because of the risk of losses to the public and even a potential threat to the stability of the financial system.

(BI) has previously said that were not recognized as a legal medium of exchange, so that they could not be used as a means of payment in

"The ownership of virtual currencies is high risk and prone to speculation because there is no authority who takes responsibility, there is no and there is no underlying asset to be the basis for the price," BI said in a statement issued late on Friday.

He said that virtual currencies could also be used in laundering and terrorism funding, and due to all these factors could have an impact on the stability of the financial system and causes losses for society.

"(Cryptocurrency) is not a legal medium of exchange. We remind (people of) its risks.

When the risks occur, the losses will be borne by the public. We are obliged to protect consumers and protect them from a bubble," said by telephone on Saturday.

Asked whether such statements from authorities could stir panic among those who had already invested in cryptocurrencies, he said: "They didn't consult with us when buying....please help us make the people understand."

Indonesian authorities have been stepping up their warnings and last month BI issued a regulation banning use of by companies involved in payment systems, and said it is examining whether there's a need to regulate trading on virtual currency exchanges.

South Korean authorities this week sent global prices temporarily plummeting and virtual coin into turmoil when the justice minister, Park Sang-ki, said regulators were preparing legislation to halt cryptocurrency trading.

Prices later rebounded on the Luxembourg-based Bitstamp, to stand at $14,116 in latest trading after touching $12,800 this week.

co.id, an Indonesian online cryptocurrency exchange, said on its website that was trading at 217.44 million rupiah ($16,288) per unit.

Some Indonesian merchants, including an online babyware supplier, indicate on their websites that they accept payment in

($1 = 13,350.0000 rupiah)

(Reporting by Agustinus Beo Da Costa and Tabita Diela; Writing by Ed Davies; Editing by Simon Cameron-Moore)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Sat, January 13 2018. 13:15 IST
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