Indonesia plans to launch its own cryptocurrency exchange this year as part of financial sector reform that will see regulatory powers over digital assets shift to the Financial Services Authority.
The government will set up the exchange before the Financial Services Authority takes over supervision of cryptocurrencies from the Commodity Futures Trading Regulatory Agency (Bappebti), which currently oversees the trading of cryptocurrencies alongside commodity contracts in Indonesia.
The launch of the exchange has been postponed multiple times in recent years due to complexities in the process.
Indonesia has a long history of support for cryptocurrency assets, with the Ministry of Trade formally authorizing crypto asset trading and recognizing cryptocurrency as a commodity in 2018.
The Indonesian Commodity Futures Trading Supervisory Authority (Bappebti) provided a regulatory framework for crypto assets futures in 2019, allowing for the buying and selling of such assets for investment purposes only.
The number of crypto investors in Indonesia has been increasing, with 11.2 million at the end of 2021 and 16 million in the first 11 months of 2022.
However, crypto trading volume in the country decreased in 2022, falling to around IDR 300 trillion ($19.2 billion) from IDR 859 trillion the previous year.
Bappebti stopped issuing registration certificates for prospective crypto asset traders in August 2022 in an effort to ensure “transparent, efficient, and effective trading activities of crypto assets with fair competition to protect the interests of all parties in the crypto trading market.”
There are currently around 25 licensed cryptocurrency exchanges operating in Indonesia, including Zipmex, which suspended withdrawals in the country in 2022 and is now preparing a recovery process.