Islamic NGOs in Indonesia Requests Prohibition of Crypto, OJK Takes Action

Islamic NGOs in Indonesia Requests Prohibition of Crypto, OJK Takes Action

The Financial Service Authority in Indonesia, also known as the OJK, at the request of Islamic non-governmental organizations, has issued a warning on financial institutions against crypto services.

According to an Instagram post by Otoritas Jasa Keuangan, or OJK, the government agency issued a statement regarding the dangers of cryptocurrency investment and Ponzi schemes that follow the crypto market. 

The warning was purely targeted towards local financial institutions that offer crypto assets. Red flags were raised when these companies started receiving calls from Islamic NGOs which requested banning crypto-based services. However, it is not clear whether the reported warning will manifest into a nationwide ban on crypto.

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Likewise, the Instagram post had a quote from OJK’s Chairman Wimboh Santoso which said that "OJK has strictly prohibited financial service institutions from using, marketing, and/or facilitating crypto asset trading." He added by issuing a short warning:

"Please beware of allegations of Ponzi scheme scams in crypto investments."

Despite digital assets not being accepted as a viable payment option in the region, Indonesia actually allows crypto asset trading which is overseen by the Commodity Futures Trading Regulatory Agency.

Likewise, Indonesia is looking to create a separate unit for digital asset regulation and supervision in the first quarter of 2022. The crypto branch will reportedly go by the name of Digital Futures Exchange.

Indonesia had almost $60B worth of crypto transactions in 2021, which is larger than a tenfold increase compared to the digital assets trading estimates of 2020. 

Dom Z. - Crypto Analyst

by Dom Z. - Crypto Analyst, BitDegree


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