Bali’s Crypto Crackdown Targets Tourists as Bitcoin Payments Banned on the Island
As per the reports, the utilization of Bitcoin and other cryptocurrencies for transactions is now prohibited in Bali, Indonesia. Bank Indonesia, the central bank of the nation, had already restricted the use of cryptocurrencies as a payment mechanism in 2021. The objective of the prohibition on Bitcoin payments in Bali is to discourage tourists from utilizing virtual currency to buy products and services.
Ban on Bitcoin Payments
Causa Iman Karana, the head of Bank Indonesia’s Bali division, has announced a ban on Bitcoin payments. Karana emphasized that the utilization of cryptocurrencies, including Bitcoin, for transactions is incompatible with the country’s payment system regulations. Moreover, he highlighted that the adoption of these digital currencies may stimulate illicit activities such as money laundering.
The central bank has also cautioned foreign exchange enterprises against operating without proper authorization, as it could lead to severe repercussions, including imprisonment and a maximum penalty of $1.4 million.
Any breaches would result in administrative punishments, such as written warnings, fines, and restrictions on payment transactions. Although cryptocurrency is permitted in the nation, Director Trisno Nugroho, the head of Bank Indonesia, has stressed that it cannot be utilized as a means of payment.
Bali’s Stance on Crypto
The recent ban on cryptocurrency as a payment method in Indonesia seems to be at odds with the country’s previously friendly stance towards the digital asset industry. It’s important to mention that Indonesia has recognized Bitcoin as a commodity and has put in place regulations for crypto exchanges and platforms.
There are also reports that the Ministry of Trade is getting ready to introduce a national cryptocurrency stock exchange by June, which was originally planned for late 2022 but has faced some obstacles.
Bali Crypto Market
In Bali, the cryptocurrency market is not very extensive. However, there is a token called Bali Coin (BALI) that was created to aid transactions in the tourism industry. Its applications include settling hotel bills, buying tickets, and renting vehicles. Presently, Bali Coin is positioned at #5118 on CoinMarketCap. However, after the recent ban, tourists won’t be able to take advantage of this token.
Bali province has witnessed a remarkable surge in cryptocurrency investment. As per Tokocrypto, a crypto exchange, Bali has emerged as their second-largest market, following the much bigger Java Island. In 2020, Tokocrypto had only 900 users in Bali, but this figure surged to 28,000 in the last year.