Indonesia's cryptocurrency market is developing at a very fast pace. Indonesia's cryptocurrency market has grown significantly in recent years, with revenue in 2024 reaching US$577.6 million. The country has become a hotbed for the introduction of various technologies in recent years. The global cryptocurrency adoption index has skyrocketed, rising from 20th to 7th place in 2023. With the growing demand, Indonesian authorities have shown interest in regulating the cryptocurrency space for the welfare of investors. Recently, a new cryptocurrency regulatory framework was passed by the Indonesian government.
This module by Coinpedia provides a step-by-step understanding of the latest crypto regulations in Indonesia.
Introduction of virtual currency in Indonesia
Indonesia's crypto market has grown in recent years and has become a hotbed for various digital assets. Indonesia skyrocketed in the Global Crypto Adoption Index, rising from 20th place to 7th place in 2023. This rapid rise shows the huge interest and acceptance of cryptocurrencies in developing countries like Indonesia.
A recent report from Coinfest Asia found that Indonesia has emerged as a major global crypto player, and its potential over the next five years is quite remarkable. Indonesia's cryptocurrency market is dynamic and filled with young, tech-savvy people. The number of cryptocurrency account holders in Indonesia has already exceeded the number of stock market account holders, exceeding 16 million.
Indonesia became the first country to launch the National Cryptocurrency Exchange PT Bursa Commodities Nusantara, also known as the Commodity Futures Exchange, in July 2023. Indonesia's national cryptocurrency exchange has no intention of competing with global giants like Binance and Coinbase.
Indonesia Cryptocurrency Regulation in 2024
The regulations currently in operation in Indonesia are:
- Bappebti Regulation No. 8/2021 on Guidelines for the Conduct of Crypto Asset Spot Market Transactions on Commodity Exchanges (as amended by Bappebti Regulation No. 13 of 2022).
- Commodity Exchange Supervisory Board Regulation No. 4 of 2023 on amendments to Commodity Exchange Supervisory Board Regulation No. 11 of 2022 on determining the list of crypto assets traded in the spot market for crypto assets.
- Law No. 4 of 2023 on the Development and Strengthening of the Financial Services Sector (Financial Omnibus Law).
Indonesia's cryptocurrency regulator is the Commodity Futures Trading Regulatory Authority, known as Bape Buti, which is supervised by the Indonesian Ministry of Trade and regulates futures trading, including crypto asset trading. With the implementation of Act 4 of 2023, regulatory powers over crypto assets will be transferred to the Financial Services Authority (OJK) by January 2025.
According to the Ministry of Trade Regulation, the Cryptocurrency Business Regulations stipulate that trading is legal in Indonesia. Indonesia prohibits the use of virtual currencies as money, but allows them to be traded as goods. 229 crypto assets have received approval from the Indonesian Commodity Futures Trading Regulatory Authority for trading in the region.
To set up a crypto asset business in Indonesia, an investor must become a certified crypto asset spot trader and meet the following requirements:
- Must have paid-up capital of Rp 50 billion or more.
- Maintain capital of over Rp40 billion.
- Obtain PSE certification from the Ministry of Communications and IT (Electronic Systems Provider or Penyelenggara Sistem Elektronik).
- Create a business plan and financial forecast for the next 24 months.
- You must follow the prerequisite system set by Bappebti.
Cryptocurrencies must comply with national regulations regarding risk assessment, anti-money laundering, and countering terrorist financing. The rules require Bitcoin dealers to maintain at least five years of trading history, maintain servers in the country, and allow cryptocurrency trading on Indonesian futures exchanges as a commodity rather than some form of payment. It has established.
In March 2024, Indonesia's financial regulator issued new virtual currency regulations. OJK has developed a crypto policy framework in collaboration with Malaysia, Singapore, and Dubai. The financial services authority OJK has issued new regulations to implement technological innovations in the field of cryptocurrencies, which will apply to cryptocurrencies from January 2025. This includes guidelines for protecting customers, setting up test spaces (sandboxes) for new technologies, and reporting results. Of these tests. OJK is working closely with the current crypto regulator Bappebti and Bank Indonesia to create a transition team to manage the transition of digital financial supervision.
Overview of legal status
Indonesia has legalized cryptocurrencies as products that can be traded on licensed platforms, but banned their use as payment methods.
| Bitcoin | Legal but only as a product |
| NFT | legal |
| mining | legal |
| transaction | legal |
| DeFi | legal |
Virtual currency taxation law
The country currently taxes cryptocurrencies as a commodity, but that could change in 2025 when they come under the supervision of financial services authority OJK. Virtual currency is treated as a commodity and is therefore subject to value-added tax and income tax. Indonesia has announced that in 2022, it will impose a 0.1% income tax on crypto income and value added tax on crypto purchases.
Future prospects and challenges
Cryptocurrency and blockchain technology is a rapidly evolving field with the potential to transform the global economy. As one of Southeast Asia's largest economies, Indonesia is well-positioned to play a key role in shaping the future of these technologies. The Indonesian government has created a suitable regulatory environment for the development of cryptocurrencies and blockchain. The launch of a crypto exchange in Indonesia by the Commodity Futures Trading Regulatory Authority (Bappebti or CoFTRA) signals the government's support for the growth of the country's crypto market. This policy, coupled with a growing population of tech-savvy young people, has created favorable ground for innovation in the cryptocurrency field.
On July 20, 2023, Indonesia launched a national platform for crypto assets that will serve as a trading venue and clearinghouse. This super-initiative aims to provide regulators with comprehensive transaction records and strengthen their supervisory capacity. This establishment is a pioneering example in the world of government-backed crypto exchanges. Bape Buti has been entrusted with overseeing this novel venture.
Indonesia is seeing very positive developments and will be a hotspot for cryptocurrencies in the coming years.
conclusion
After ranking 7th in the Global Cryptocurrency Adoption Index, we are optimistic that Indonesia will only move up from here when it comes to cryptocurrencies. The future has even more in store for those who want to explore the cryptocurrency-related playing field.
