The Indonesian Ministry of Commerce is planning to issue a new rule governing crypto-asset exchanges. To ensure more local control, the Indonesian government intends to implement new rules that require that two-thirds of any board of directors and commissioners be Indonesian citizens, in addition to being resident in the country, to me Reuters.
According to reports, the ministry’s Commodity Futures Trading Regulatory Agency (Bappebti) will issue the new legislation soon. Ensuring that two-thirds of board members are Indonesians residing in the country “could prevent senior management from running away when a problem arises on the stock exchange,” Dedid Nordiatmoko, the acting chairman of Papipeti, told Indonesia’s parliament at a hearing.
With regards to the guidelines, Deputy Trade Minister Jerry Sambuaga said: “We don’t want to give permits (to exchanges) carelessly, so only for those that meet the requirements and are credible.”
The new rules will also require exchanges to use third parties to store client funds, and ban companies from reinvesting any stored crypto assets, according to a document released by the ministry.
Indonesia’s decision caused by financial issues in Southeast Asia
Recently, other countries in Southeast Asia have tightened regulations regarding cryptocurrencies. The Securities and Exchange Commission of Thailand recently banned crypto operators from offering or supporting deposit and lending services; Filed a formal police complaint against Zipmex, one of the leading digital asset exchange platforms in the Asia Pacific region (operating in Singapore, Thailand, Indonesia and Australia) for non-compliance; Bitkub was fined 8.53 million baht for insider trading.
The Monetary Authority of Singapore (MAS) has issued strong warnings to retail investors, advising them to avoid cryptocurrencies, with increasingly stringent measures in place to restrict retail access to cryptocurrencies.
It is noteworthy that Indonesia reached the list of the top 20 countries in 2022 global encryption adoption index, Posted by decomposition, along with prominent Asian countries and emerging markets. Moreover, according to a study by cryptocurrency exchange Gemini, the ownership of crypto assets in Indonesia has been among the highest in the world, with many investors in the country viewing digital assets as a protection against inflation in the future.
According to Bappebti data, the cryptocurrency only gained popularity in Southeast Asia’s largest economy, with the total transaction volume of crypto assets in the country increasing by more than 1,000% in 2021, at 859.4 trillion rupees (or approximately 57.37 billion US dollars) .
The Indonesian government has been looking at regulating digital currencies and introducing a central bank digital currency (CBDC) as a way to curb the growing adoption of cryptocurrencies in the region. The measures taken are likely to affect a large percentage of the local population involved in crypto-asset trading.