In a recent move, Indonesia has launched a national crypto asset bourse marking it as one of the significant moves towards the industry. The government announced that this bourse will provide regulators with transaction records and better protection to crypto investors.
According to the Commodity Futures Trading Regulatory Agency (Bappebti), the launch of the exchange and clearing house is also intended to strengthen regulation of the booming sector amid a transition in regulatory oversight. Badan Pengawas Perdagangan Berjangka Komoditi or abbreviated as BAPPEBTI is an institution owned by the Ministry of Trade that was established to assist in overseeing and drafting regulations related to commodity trading, futures, and foreign exchange markets in Indonesia.
Notably, while Indonesia banned the use of cryptocurrencies as a means of payment, it continues to allow investment in the assets. Reportedly, such investment surged during the pandemic, with data showing that as of June, 17.54 million people in the country had invested in the digital assets. Sources reveal that this was more than the number of investors registered with the stock exchange. However, in recent months, rising global interest rates have dampened demand for crypto assets.
According to Bappebti, crypto transactions in Indonesia during the January-June period were down 68.7% from the same period last year to reach 66.44 trillion Rupiah ($4.42 billion), with Tether, Bitcoin, Ethereum, Ripple and Binance Coin being traded the most. Reportedly, the new bourse will list existing licensed crypto companies, such as Binance’s Tokocrypto, Indodax and others as traders.
In an official statement, Bappebti chief Didid Noordiantmoko said that PT Bursa Komoditi Nusantara will run the bourse. On the other hand, PT Kliring Berjangka Indonesia, a company operates as a clearing agent and settlement guarantee for transactions that occur on the Jakarta Futures Exchange (BBJ) as well as transactions that occur outside the stock exchange made by its members, will clear transactions on the upcoming platform.
Simultaneously, PT Tennet Depository Indonesia is appointed as crypto asset storage manager. The launch of this exchange is not big of a surprise as the authorities had revealed their plans earlier. Speaking to media about the upcoming platform, Bappebti chief said said all cryptocurrency transactions would be only allowed to take place using the national exchange.
Additionally, the official revealed that the involved parties have agreed on rules for the exchange and discussions involving Know Your Customer (KYC) procedures. Notably, trading on the exchange would be offered through an integrated application, which the regulators have already tested. Didid added:
“We conducted system integration tests between traders, exchanges, clearing, and depository.”
Reportedly, a new law which was signed earlier this year called for the regulation, supervision and oversight of crypto to be transferred to the Financial Services Authorities from Bappebti, with a two-year transition period.
Overall, this move from the regulators in Indonesia signal at a step to embrace the industry while safeguarding investors’ interest. Simultaneously, amid the increasing uncertainty around exchanges and their compliance standards, this move isn’t surprising and rather something which could set an example for several other nations.