Cryptocurrency

Indonesia is on the move to becoming the largest Muslim power economy on earth and ready to pave a path for cryptos, or is it?

What is the first thing that comes to your mind when you think of Indonesia?

I do not know about you, but I surely do not think economy and cryptos, all I can think about is the beautiful Bali Island.

Bali is the main tourist destination in the country (and no, Bali isn’t a country folk, but one of the 34 provinces in Indonesia), with 80% of its economy being sustained by tourism, which has been growing significantly in the past decades. It is well-known for its highly developed arts as modern dance, sculpture, leather, music, painting, and metal working. It has won the TripAdvisor Traveler´s Choice Awards as the number one destination.

 

Well, it turns out that Indonesia (obviously) is so much more than Bali and the world should pay close attention to it; this nation is becoming the largest economic Muslim power on earth! As the world´s third largest democracy it has proven that democracy and Islam can walk hand in hand with much success, as Joko Widodo the President of Indonesia says.

The Republic of Indonesia is the largest archipelago nation in the world with over 17,000 islands, located in Southeast Asia between the Indian Ocean and the Pacific Ocean.

The world´s 4th most populous country with 261 million individuals and Java alone hold more than half of the country´s population.

Borobudur, Indonesia; this is the largest Buddhist temple in the world. Photo by Christine Wehrmeier on Unsplash

 

Jakarta, or The Special Capital Region of Jakarta a metropolitan area, is the capital and largest city of the nation which has 34 abundant provinces in natural resources as oil, natural gas, tin, copper, and gold. Grasberg mine is the largest Gold and copper mine located in Java Island. The main industries in the nation are palm oil, coal, petroleum and natural gas, automotive, textiles, electrical appliances, footwear, apparel, medical instruments and appliances, mining, cement, hand-crafts, plywood, chemical fertilizers, rubber, jewelry, processed food, and tourism.

Even though Indonesia is the most populous Muslim-majority country, which means more than 87% of the country happens to be from the Islamic religion, the nation is well-known for a large number of trans-genders who are not only respected but also welcome in Indonesia. But do not get it twisted Indonesia is a very strict country, and they follow rules legalistically, like the death penalty for drug trafficking and usage.

You might want to take a look at this blog post before traveling to Indonesia : “11 Things You Should Never, Ever Do in Indonesia

Rupiah is the local currency, which has one of the lowest values in the world. (1 United States Dollar equals 68.99 Indian Rupee today)

 Traditional balinese offerings to Gods with fruits; photo taken by Artem Bali@belart84

 

Indonesia is a very rich country in every way, and this is evident in their gastronomy, culture, music, religion, architecture, it is a very in-depth nation, and it passes right on to its people, governance, and economy.

It has the largest economy in Southeast Asia and one of the greatest emerging market economies of the world; newly classified as an industrialized country, and also a member of the G20.

New Legislation in Indonesia recognizes crypto as trading commodity.

BAPPEBTI — The Commodity Futures Trading Regulatory Agency, passed regulation no. 5/2019 that acknowledges cryptocurrencies as a trading commodity. The legislation, therefore, gives legal acceptance to cryptocurrency exchanges, taxation and other related issues currently operating in the country..

Cryptos traded in the country need to comply with risk assessment, anti-money laundering (AML) and combating the financing of terrorism (CFT) requirements.

The policy conditions crypto traders to keep transaction archives for at least five years, and have a server located within the country.

According to the Head of BAPPEBTI Indrasari Wisnu Wardhana the main focus of this regulation is protecting the people who would like to invest in crypto assets from fraudulent crypto scams.

  Jakarta the capital of Indonesia; Photo by Gede Suhendra on Unsplash

 

Aside from consumer protection, it also focuses on good governance principles for crypto asset traders, legal certainty, the requirement for BAPPEBTI to establish a physical market for crypto assets through electronic infrastructure and regulates crypto assets that could be traded as well as mechanisms for crypto asset trading, starting from the opening of accounts, fund saving, crypto asset transaction, withdrawing crypto assets and withdrawing funds.

But not everyone seems thrilled with what seems to be a great step for the cryptocurrency community in Indonesia. Crypto brokers are very unpleased with the new regulations because it forces brokers to have at least 70 million to launch futures trading, about one trillion rupiahs according to JakartaPost.com.

According to CoinDesk the rules are also clear that they do not apply to ICOs and that using cryptos as means of payment is reportedly still banned in the country. (Yeah I’m puzzled as well)

And it was confirmed by Onny Widjanarko, Head of the Bank of Indonesia from the payment system policy department who said — “BI still prohibits Bitcoin or crypto as a means of payment […] Commodity is not an area of BI, but we are concerned about the above.

Economist Bhima Yudhistira Adhinegara from The Institute for Development of Economics and Finance (INDEF) says this regulation is “a bit too late”.

Although BAPPEBTI has stipulated new rules, everything still seems unclear and confusing, and regulatory clarity is much needed, but even so the new rules is a start, it is not too late as some may believe, simply because cryptocurrency takeover is just a matter of time and taking steps towards the development of the industry is at least smart.

Photo by Omer Rana on Unsplash

 

Final Thought: Cryptocurrency and Blockchain ecosystem can be revolutionary in a country like Indonesia where salaries are so low, and where according to Bloomberg out of 261 million citizens only fewer than a million people pay taxes. It would give the country international opportunities within the global market, without discrimination, regular people would find new ways to bring income into the country, diminishing poverty, corruption maybe even break the country´s dependence on tourism alone, after all its never good to have all your eggs into one basket.

Do not leave this blog post without doing research of your own about Indonesia, its culture, economics, gastronomy, crypto community and its people. It will be worth your time and probably much more than you have imagined.

Drop your comments in the comment section and let us know what your thoughts are about the nation and the new crypto rules. And please feel free to add on if you have any news.

The Winco Team


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Disclaimer: Our team works hard to bring you the best content in the cryptocurrency market, but it is only our point of view and not legal advice, and may be divergent from other opinions, so please do not make any decisions without concluding studies of your own to understand the profit possibilities and uncertainties involved at your own risk.

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