Understanding CBDCs: Opening the Gateway to the Future of Digital Finance

Jakarta, May 17, 2024—Bank Indonesia (BI), the Indonesian Institute of Accountants (IAI), and The Institute of Chartered Accountants in England and Wales (ICAEW), in collaboration with SW INDONESIA, organized an international conference titled “Decoding CBDCs: Unveiling the Future of Digital Money” on May 14, 2024. This event in Jakarta for enhancing literacy about Central Bank Digital Currencies (CBDCs) in Indonesia.

CBDC is a digital representation of physical cash, enabling secure and efficient transactions within the formal financial system. Unlike cryptocurrencies such as Bitcoin or Ethereum, CBDCs are backed by the full faith and credit of the government, making them a legitimate and trusted means of payment.

This international conference featured two insightful sessions filled with engaging discussions. The event commenced with opening remarks from Elaine Hong FCA, ICAEW Director for China and Southeast Asia, and Ardan Adiperdana, Chairperson of the IAI National Governing Council.

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The first session included prominent panelists: Ryan Rizaldy (Director of Payment Systems Policy, Bank Indonesia), Peter Brewin FCA (Partner, PwC Hong Kong), and Tigran Adiwirya (Co-CEO, D3 Labs), moderated by Dede Rusli, a member of the IAI Financial Accounting Standards Board (DSAK). They explored vital topics such as the comparison between CBDCs and cryptocurrencies, government and financial services perspectives, and the infrastructure and technological requirements of CBDCs.

The second session featured a presentation by Nikhil Joshi (Chief Operating Officer, Emurgo), moderated by Thomas H. Gunawan (Managing Partner, SW Digital Solution). This discussion highlighted the development of digital networks and information technology that could transform traditional payment systems involving physical and non-cash money.

Adoption of Blockchain and CBDCs

Panelists and speakers navigated various opportunities and risks associated with CBDCs. Bank Indonesia, through its latest initiative, “Project Garuda,” is developing the Digital Rupiah as a future means of payment. This project has entered the second phase of the Proof of Concept (PoC) and is undergoing a series of pilot projects and trials.

Ryan Rizaldy from Bank Indonesia affirmed BI’s commitment to adopting blockchain technology and introducing the Digital Rupiah as a legitimate means of payment. “Project Garuda aims to find the best technological solutions that align with Bank Indonesia’s configuration. We set functional and non-functional requirements based on business technology details and regulatory design. We will soon release the PoC report to the public,” he stated.

D3 Labs, as one of the speakers at this conference, explained its crucial role in helping banks and other financial institutions understand the needs and requirements for implementing CBDCs and adopting blockchain technology. D3 Labs provides tools to explore various use cases and equips banks with the necessary knowledge and capabilities, especially regarding best practices and risk management.

Tigran Adiwirya, Co-CEO of D3 Labs, elaborated on the significant role of D3 Labs in helping banks and financial institutions understand and implement blockchain technology and CBDCs. “With blockchain, banks can enjoy liquidity, interoperability, and transparency. We are committed to providing the necessary infrastructure, tools, and expertise to support banks and financial institutions in their transition to CBDCs,” he explained.

The event also emphasized the importance of collaboration between the public and private sectors in achieving effective and safe CBDC adoption. This collaboration is crucial in enhancing literacy and understanding of blockchain technology adoption in Indonesia. As a result, CBDCs are expected to act as a catalyst for greater efficiency, cost reduction, and financial inclusion.