Indonesia Legitimizes Cryptocurrencies, Classifying Them as Commodities
Indonesia’s Trade Ministry Futures Exchange Supervisory Board (Bappebti) has ruled that cryptocurrencies will be future trading subjects or commodities at the country’s stock exchange, despite the fact that Bank Indonesia (BI) still does not recognize cryptocurrencies as valid means of payment.
Legitimization in Indonesia
Cryptocurrencies will soon be classified as commodities within the country of Indonesia.
Dharma Yoga, Bappebti’s head of market supervision and development bureau, stated:
The Bappebti head has signed a decree to make cryptocurrency a commodity that could be traded at the bourse.
As reported by The Jakarta Post (via kontan.co.id), Dharma also claimed the decision came after a four-month study on cryptocurrencies, which ultimately concluded that the new forms of value transfer should be considered commodities.
Further regulation — which will directly address issues revolving around currency exchange companies, taxation, money laundering, and terrorism financing — will reportedly be announced in the near future. Dharma revealed that said regulation will come, in part, from BI, the Financial Services Authority (OJK), the Taxation Directorate General, the Financial Transaction Reports and Analysis Centre (PPATK), and the National Police’s Densus 88 counterterrorism unit.
Play by the Rules
As noted by The Jakarta Post, Bappebti expects existing cryptocurrency exchanges to fall in line with incoming regulations. The exchanges which will most notably be affected are Indodax — formerly Bitcoin Indonesia — and Crypto Community. All cryptocurrency exchanges will be expected to submit proposals for product specification and trading procedure. Dharma stated:
We call on the bourses to prepare concrete proposals on the issue.
The proposals must include information regarding the types of cryptocurrencies being traded, the hours they are available for trade, and the mechanism by which disputes are handled.
A Sign of Softening
Indonesia has not been known as a cryptocurrency-friendly country.
In December of last year, Central Bank Governor Agus Martowardojo announced the prohibition of all cryptocurrency-related transactions in an effort to secure the country’s fiat currency, the rupiah. At that time, he stated:
We are also preventing the potential for arbitration, unhealthy business practices, and the control of businesses by parties untouchable by laws in Indonesia that could who could damage the structure of industries here.
It remains unclear whether or not cryptocurrencies will be legitimized for use as currencies, but classifying them as commodities may be a step in the right direction for the restrictive country.
What do you think about the classification of cryptocurrency as commodities in Indonesia? Let us know in the comments below!
Images courtesy of Bitcoinist archives, AdobeStock, Shutterstock