"Cryptocurrencies are not a legal tender in Indonesia," Indrawati remarked here on Tuesday.
The minister stated that virtual currencies had been banned by various countries, as the transactions carried high risks and were rife with speculations.
Virtual currencies are prone to being used for money laundering and terrorism financing that can affect financial stability and harm society.
"The currency cannot be used as an investment instrument, as it provides opportunities for fraud and crime.
The Financial Services Authority (OJK) does not allow financial services industries to process any cryptocurrency payments.
"We express readiness to educate the public against the risks of various instruments that are not issued officially under the OJK`s supervision," OJK Chairman Wimboh Santoso emphasized.
According to the regulation, all financial services products issued must be reported to the OJK.
In December 2017, the Central Bank of Indonesia had announced all trades using the virtual coin to be illegal.
"We have disapproved all Bitcoin transactions in Indonesia. Hence, we will fine and impose a penalty on financial service providers still found to be using the virtual currency," Enny Panggabean, the central bank`s director executive of policy and payment system supervision, had noted in Jakarta on Friday (Dec 15).
According to the Indonesian authority, Bitcoin has not only failed to provide a secure and safe form of investment but is also prone to being used as a platform for committing crimes, such as money laundering.
Moreover, the virtual Bitcoin could disrupt financial stability, as the digital currency has a steep rate of fluctuation.
The single virtual coin worth less than US$1 was first launched in 2009, but in 2013, the value had surged to $92 and continued to grow by 819 percent in 2014, with $846 per coin.
The Bitcoin rate earlier this year was recorded at $977, and the value had significantly risen to $16,747 per coin, and now, it was corrected to $14,615, or equal to Rp197.3 million.
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Reporter: antara
Editor: Heru Purwanto
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