This is the 6th article in the series which covers the importance of the G20 countries in the global legalization of crypto.
Indonesia is the most dominant player in East Asia. It is the largest contributor in (Association of East Asian Nations) ASEAN.
It is one of the G20 economies.
Regulators in this country are a bit sceptical about crypto as a currency.
But, given its economy and size, Indonesia will play a key role in global crypto adoption and regulation just like other G20 countries.
Let’s understand more about Indonesia’s role in the international system.
Statistics of Indonesia
It is the largest country in South East Asia by area and the 14th largest in the world, according to World Bank’s data.
With a GDP of over $1.05 trillion, it is the 16th largest economy in the world.
When it comes to manpower, it has plenty as it is home to over 27 crore people and ranks 4th in the world.
For crypto adoption, the country ranks 25th in the Chainalysis Global Crypto Adoption Index and 27th in Global DeFi Adoption Index.
So, the market is not that bad even when the regulators are not fond of digital assets.
However, Indonesia ranks 4th in the world for the number of visits to cryptocurrency scam websites from July 2020 to June 2021. This could also be a reason for the apprehensions of regulators.
Regulatory Environment in the Country
Crypto is not illegal and is largely treated as a commodity in Indonesia. But regulators stay wary of crypto assets.
In 2017, the Central Bank had mulled a ban on Bitcoin payments.
But, the trading of crypto is legal as the Commodity Futures Trading Regulatory Agency (BAPPEBTI) had issued a whitelist of legal crypto assets for trading in Indonesia in 2020.
Last year in May, Government contemplated levying tax on crypto profits, reported Reuters.
Six months later in November 2021, the National Ulema Council (MUI) echoed declared crypto ‘haram’ due to “uncertainty, wagering and harm.”
Recently, on January 25, 2022, Indonesia’s Financial Services Authority (OJK) warned companies against offering sales of crypto, according to a Reuters report.
The stances of regulators do not paint a clear picture of the prospects of regulation in the country. Regulators are dissuading the use of crypto as a payment method. They just see it as a speculative asset. Any sovereign would be concerned if the supremacy of its currency is challenged by anything. Maybe that’s why Indonesian regulators do not accept crypto’s currency use case.
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