Indonesia to develop Shariah-compliant blockchain gold exchange
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Indonesia to develop Shariah-compliant blockchain gold exchange

IT seems as though efforts to bring blockchain to the financial services industry across the Asia Pacific is slowly picking up momentum.

Indonesia’s leading futures and derivatives group, Jakarta Futures Exchange (JFX) is joining forces with Australia’s Kinesis Money and Allocated Bullion Exchange (ABX) to develop a blockchain powered exchange in Indonesia.

The collaboration primarily focuses on creating an alternative option to the current financial offerings. The blockchain based solution will come with added benefits such as being simpler, faster and more secure.

“It’s increasingly become clear to us that the benefits of distributed ledger technology or ‘blockchain’ will unlock tremendous amounts of value for Indonesia and Indonesian people,” JFX President Stephanus Paulus Lumintang said in a statement.

SEE ALSO: Malaysia is turning to blockchain to boost its three largest industries

Blockchain regulation in Indonesia is an ongoing process at the moment, something Lumintang describes as challenging but crucial.

He is confident that JFX is ready to be a blockchain exchange company that is compliant with any regulatory requirements that may come its way.

“Our future partnership with Kinesis and ABX will enable us to not only tap into these advantages but to create a secure and transparent blockchain network that provides a credible alternative to existing systems of exchange,” he said.

Australian outfits Kinesis and ABX have together developed a digital currency system using real assets – gold and silver- as its basis, and these currencies are shifted on the Kinesis Blockchain Exchange that is a part of Stellar Network.

The network capable of handling more than 300 transactions per second and is integrated with mobile banking and fiat currency exchange services.

ABX has been working with JFX in expanding gold investments into Indonesia and now the two companies are launching a spot physical Sharia Gold Contract after securing the permit by Indonesia regulators and National Shariah Board.

SEE ALSO: What is holding back the cashless economy in Asia?

“A blockchain exchange version of gold-based currencies, through collaboration with Kinesis and ABX, is a natural extension of the JFX and Indonesian government vision,” the statement read.

Kinesis and ABX CEO Thomas Coughlin said, “The bespoke blockchain network that we developed creates a complete monetary system which enables real, physical assets to be transacted and exchanged digitally, at speed and at low cost.

“We believe that the integration of physical precious metals and distributed ledger technology offers tremendous value to the Indonesian market, with its dual interest in gold and in blockchain. We look forward to continuing our partnership with JFX to bring this to fruition.”

While many have been speaking of blockchain for years now, the implementations of the technology as part of solutions to the real world challenges is yet to be seen.

Stakeholders expect the venture in Indonesia to propel institutional acceptance of blockchain technology, through the sharing of concepts, business models, and technology solutions in the region.

This article originally appeared on our sister site Tech Wire Asia