Legal Analysıs Of Cbdc's Role As A Dıgıtal Payment Instrument Regulatory System In Indonesıa

Abstract

Bank Indonesia as the Central Bank in Indonesia has the duty to administer, regulate and maintain the smooth operation of the payment system as stipulated in the Law of the Republic of Indonesia No. 23 of 1999 concerning Bank Indonesia.  The Central Bank has the authority to issue and circulate currency as legal tender in a country.  Currency is not limited to cash and demand deposits, but also non-cash payment instruments in electronic and card-based forms in line with the rapid digitalization. Digitalization has changed the way humans carry out economic activities.  Marked by the existence of crypto assets that are loved by modern society, crypto assets have emerged to grow rapidly at a time when economic growth is declining.  In addition, loose monetary and fiscal policies are occurring evenly throughout the world, including Indonesia.  Thus, crypto assets have bigger potential to develop financial system inclusion and efficiency, but on the other hand they also have the potential to create new sources of risk that can affect economic, monetary and financial system stability.  The development of crypto assets is the background for Central Banks in designing and issuing Central Bank Digital Currency (CBDC) or a digital currency called Digital Rupiah.  Bank Indonesia on 30 November 2022 issued a White Paper regarding the design for developing a Digital Rupiah called the Garuda Project.