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The hope for mainstream cryptocurrency adoption lies in the next wave of fintech, where apps and bank-like solutions would more easily integrate blockchain-based assets. But this time, regulators are moving in to prevent this.

Indonesia, in a bid to defend the national currency, has tried measures to prevent crypto coins from being used in fintech apps. Curiously, Indonesia may still allow cryptocurrency trading, although providing banking for exchanges may see future problems.

But a ban coming in effect from January 1 states that financial apps cannot integrate crypto coins as payment options. In effect, this undermines the decentralized nature of Bitcoin and altcoins. The Indonesia government wants to ban forms of payment processing and make payment processing available only by owning a banking license.

Of course, crypto coins can process transactions without a bank back office procedure, so the demand for a bank license is counter to the very nature of digital assets. The usage of crypto coins also sees too much volatility and may be risky at the personal finance level:

"Virtual currency is very volatile, according to our observation and nobody can guarantee its movement because there is no basis for it," said Iwan Junanto Herdiawan, head of the fintech office at Bank Indonesia. 

And while the usage of cryptocurrencies within apps is very limited, and even more limited in Indonesia, such moves show how governments could crack down on crypto coins, while being generally accepting of fintech payment systems, even going as far as licensing them and allowing smoother partnerships with banks.

While cryptocurrencies still have a total market cap of $400 billion, which is small on a global scale, using one coin may pose challenges to a central bank trying to tailor the money supply to the economy. This is one source of skepticism related to freely using Bitcoin or altcoins.

Indonesia recognizes fintech firms as those providing payment systems, market support, investment management or risk management, P2P lending, financing providers and other financial services. A lot of those services have been co-opted by blockchain startups, many of which also combine the payment with a dedicated app.

All new fintech products in Indonesia would be tested in a sandbox environment before receiving a license.