Legal Development Concerning the Creation of Digital Currency in the Financial System

Abstract

Purpose: This research delves into the legal dimensions surrounding the creation of Digital Rupiah, a digital currency, in response to the evolving landscape shaped by technological innovations and shifting consumer behaviors. The primary objective is to scrutinize the legal development necessary to facilitate the integration of Digital Rupiah within the Indonesian financial system. Theoretical Reference: Grounded in a normative legal research approach, specifically doctrinal research, this study draws on legal theories and frameworks. By examining existing legal principles, the research aims to generate arguments, theories, or new concepts that address the multifaceted challenges associated with the introduction of digital currencies in the financial sector. Method: Utilizing the normative legal research methodology, the study critically evaluates the current legal structures, substances, and cultural aspects relevant to the financial system. This approach enables a thorough analysis of the legal prerequisites essential for the successful implementation and regulation of Digital Rupiah. Results and Conclusion: The study's findings affirm that the strategic plan to introduce Digital Rupiah represents a significant advancement in the Indonesian financial system. However, the realization of this digital currency's potential hinges on addressing various legal considerations. Specifically, the convergence of legal structure, legal substance, and legal culture is imperative to establish a cohesive framework supporting the integration of Digital Rupiah. Implications of Research: This research highlights the pivotal role of legal developments in shaping the trajectory of the Indonesian financial system amidst the rise of digital currencies. The implications extend beyond the financial sector, influencing regulatory policies and guiding future legal frameworks to accommodate the intricacies of digital currencies like Digital Rupiah. Originality/Value: Contributing to both academic discourse and practical insights, this research enriches the understanding of legal dynamics associated with digital currencies in the Indonesian context. The identification of essential elements—legal structure, legal substance, and legal culture—provides valuable insights for policymakers, legal practitioners, and scholars navigating the complexities of financial technology.