ABSTRACT
This article discusses the compliance oversight of crypto assets and digital financial assets in Indonesia, which will undergo a regulatory transition from Bappebti to OJK and Bank Indonesia starting January 10, 2025. Although investments in digital financial assets hold significant potential, high volatility and security risks remain the biggest challenges to address. The transition to the new regulation aims to enhance transparency, consumer protection, and market stability. OJK and BI are working to strengthen legal infrastructure, improve public literacy, and ensure the sustainability of business in the digital financial sector.
Digital financial assets are financial assets that are stored or represented digitally. These assets possess several characteristics, including being electronically stored, digitally accessible, tradeable or manageable online, usable as a means of payment or investment, and capable of generating income when there is demand for what they represent. Digital financial assets can take various forms, such as digital documents, images, videos, music, software, cryptocurrencies, or NFTs (Non-Fungible Tokens).
In Indonesia, crypto assets owned by anyone cannot be used as a means of payment, as regulated through Law Number 7 of 2011 concerning Currency. In the law, it is explained that the legal tender in Indonesia is rupiah. Thus, the only way to be able to transact is to convert your crypto assets to rupiah currency.
However, crypto asset investments are still permitted based on the consideration of their significant investment potential, which can support economic development in Indonesia. This is explained in the Coordinating Minister for Economic Affairs’ Letter No. S-302/M.EKON/09/2018 regarding the Follow-up on the Coordination Meeting for the Regulation of Crypto Assets as Commodities Traded on the Futures Exchange.
Although considered secure due to its cryptography-based security system, crypto assets as investment instruments still carry their own risks. These risks were explained by the Financial Services Authority (OJK) as reported by national media. OJK stated that the value of cryptocurrencies is highly volatile and unpredictable. This results in fluctuations in the value of cryptocurrencies that can occur at any time without a clear reason. Investing in digital assets can be profitable, but it also carries risks. These risks include asset volatility and access security.
To protect public interests, monitoring compliance regarding crypto and other digital assets must inevitably be carried out by regulators as part of their supervisory and regulatory duties. Starting from January 10, 2025, the authority for supervising and regulating digital financial assets officially transitions from the Commodity Futures Trading Regulatory Agency (Bappebti) to the Financial Services Authority (OJK) and Bank Indonesia (BI).
The transfer of regulatory and supervisory authority over digital financial assets, including crypto assets and financial derivatives, to OJK and BI is carried out based on Article 8 point 4 and Article 312 paragraph (1) of Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (UU P2SK), and further regulated in Government Regulation Number 49 of 2024. This regulation aims to encourage the financial sector’s contribution to inclusive, sustainable, and equitable economic growth, as stipulated in Article 2 of UU P2SK.
OJK is responsible for overseeing digital financial assets, including crypto assets and financial derivatives in the capital market, with its primary focus being:
- Formulating regulations to ensure transparency and consumer protection.
- Implementing a licensing system through the Integrated Licensing and Registration System (SPRINT).
- Maintaining market stability and enhancing public trust in digital financial assets.
As the legal infrastructure for the takeover by OJK, OJK previously issued Financial Services Authority Regulation (POJK) Number 27 of 2024 concerning the Administration of Digital Financial Assets Including Crypto Assets, also known as POJK AKD AK. OJK also issued Financial Services Authority Circular Letter (SEOJK) Number 20/SEOJK.07/2024 concerning the Administration of Trading in Digital Financial Assets Including Crypto Assets (SEOJK AKD AK), which outlines the key provisions of the related regulations.
Meanwhile, BI has taken over the supervision of financial derivatives related to the Money Market and Foreign Exchange Market (PUVA), with its primary focus including:
- Regulating derivative instruments as hedging tools;
- Developing a reliable, efficient, and integrated supervisory infrastructure;
- Reporting derivative transactions in accordance with established procedures.
Although this transfer aims to enhance legal certainty, there are numerous challenges that must be addressed, including:
• The complexity of blockchain technology and crypto assets.
• Potential risks such as fraud, money laundering, and illegal financing.
• The still-limited public literacy regarding digital financial assets.
To address these challenges, OJK and BI are collaborating with various stakeholders to enhance public literacy about digital financial assets through education and outreach, develop flexible regulations while maintaining prudential principles, and ensure business sustainability by strengthening technological infrastructure. The transfer of supervision over crypto and digital financial assets from Bappebti to OJK and BI is a strategic step to strengthen the digital financial sector.
SW Counselor at Law continues to update its knowledge on new regulations related to investment, economy, and business in Indonesia. This knowledge updating is part of competency enhancement to support legal services that include consultation, litigation, training, assistance, and preventive legal solutions to ensure the smooth investment of clients in Indonesia. This also applies when legal aspects become relevant to the latest developments in digital technology and sustainability.
