According to an official, the Indonesian government is ready to launch a cryptocurrency exchange by the end of the year. This approach is part of a global approach in favor of the regulation of cryptos. It also highlights the growing interest of individual and institutional investors for this asset class. Indeed, cryptocurrency transactions in Indonesia increased by 1,224%. Concretely, this represents 859.4 trillion rupiahs (57.5 billion dollars) in 2021 up from 64.9 trillion in 2020. In the first six months of this year, there were 15.1 million crypto users in Indonesia. In terms of cryptocurrency transactions, this represents a value of 212 trillion rupiahs.
Requirements for the creation of a Cryptocurrency Exchange
The Dealstreetasia reported the establishment of a Cryptocurrency Exchange by the end of the year. These words are those of the Indonesian Deputy Minister of Commerce, Jerry Sambuaga. Speaking on the sidelines of WIR Group’s NXC International Summit 2022 in Bali, the Minister of Commerce explained that this initiative is part of the government’s efforts to protect consumers amid growing interest in digital currencies. . Originally scheduled for 2021, the launch of the scholarship has been postponed due to the complexity of the process. Minister Sambuaga said he was careful and did not want to rush so as not to miss anything.
Indeed, the creation of a Stock Exchange requires many preparations. Preparation includes determining which entities should be included in the Exchange. Added to this is the determination of minimum capital and other depositary-related requirements. Tokocrypto CEO Pang Xue Kai believes that a cryptocurrency exchange can help increase the number of participants in the cryptocurrency industry and the interest of institutional investors. Tokocrypto is one of 25 cryptocurrency exchanges in the country. To be authorized, it is necessary to have the approval of the Indonesian Market Regulation Agency in terms of raw materials (Bappebti).
Digital Assets: Qualification in Indonesia
Today, Indonesia allows the trading of cryptocurrencies as commodities. However, it does not recognize crypto as a payment instrument. In April, Indonesia’s Directorate General of Taxation said it had set the income tax (PPh) on capital gains from crypto investments and the value added tax (VAT) on crypto purchases at 0, 1%.
Additionally, in January 2021, the Indonesian Financial Services Authority (OJK) warned that companies are not allowed to offer and facilitate cryptocurrency sales. However, the country’s Minister of Commerce, Muhammad Luthfi, said last September that the Indonesian government will not ban cryptocurrencies like China has done. Nevertheless, it is clear that a legislative nuance exists. Indonesia’s highest Islamic body, the authority in charge of Sharia compliance, has declared cryptocurrencies haram. Indeed, Muslims could not have access to this asset class under Islamic law.
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