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Indonesia’s New Crypto Rules Tough on Futures Trading

Indonesia’s New Crypto Rules Tough on Futures Trading

Newly-released rules for Indonesia’s cryptocurrency sector have been met with concern by industry players, who accuse the government of limiting the industry’s effectiveness, as reported by the Jakarta Post.

New government regulations, given the green light last week, require cryptocurrency traders to maintain a deposit of IDR 80 billion (Indonesian rupiah or approximately USD 5.7 million) in order to participate in futures trading activities. Cryptocurrency traders will also be required to have a minimum paid-up capital of a further IDR 800 billion (USD 56.7 million).

The Indonesian markets regulator, the Trade Ministry’s Futures Exchange Supervisory Board (Bappebti) issued Ministerial Regulation No. 5/2019 that also requires traders to have client support personnel who have been registered as certified security practitioners in order to operate.

The industry in Indonesia has made its objections clear, arguing that the Bappebti are penalizing the cryptocurrency industry in a way that hasn’t been the case with other sectors of the economy. Traders argue that the minimum capital requirement, for example, exceeds what is demanded when launching a rural bank, and dealers in conventional futures commodities require a lower paid-up capital in order to operate.

Under the new regulations, cryptocurrency futures traders in the country will need to store transaction records for at least five years, with the proviso that at least one of their servers are located in Indonesia.

Although the use of Bitcoin and other cryptocurrencies have been banned by the Bank of Indonesia (BI) futures trading is quite legal after rules were put in place last year. The country has experienced a trading boom despite the ban on actual cryptocurrency use, with reports last year that that crypto traders were expected to outnumber stock traders with time.

In other news from Indonesia, a Jakarta man was arrested this week for operating a mining program using a college computer. The 22-year-old former student at the college has been accused of using a HoneyMiner program to mine Bitcoin and Monero on 27 college computers.

 

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Indonesia Gets Green Light for Bitcoin Futures as Supervisory Board Says “Yes”

The Indonesian Futures Exchange Supervisory Board (Bappebti) is reported to have been given the green light for cryptocurrencies to be traded on the country’s futures exchange, having finally been designated as commodities, writes Coindesk.

Bappebti is an agency that was launched in 2005 to regulate certain sections of the financial services industry in Indonesia. It stands for Badan Pengawas Perdagangan Berjangka Komoditi, or the Indonesian Commodities and Futures Trading Regulatory Authority. It is the only agency with regulatory responsibility for various financial institutions. It operates under the supervision of the Indonesian ministry of finance and is managed by a board of administrators, all of whom are selected by the government from industry experts.

Jakarta Post reported on Monday that Bappebti’s market supervision chief Dharma Yoga confirmed the decision after a four-month study, which now clears the way for Indonesia’s launch of Bitcoin futures in Indonesia. Further details will be released by the country’s central bank shortly highlighting regulations concerning crypto exchanges and taxation issues.

This news represents a major turnaround in the fortunes of Indonesia’s crypto space as it was only last year that the central bank stated that it did not recognize Bitcoin as a legal payment system, although exchanges were not mentioned in the bank’s official statement. Further to this development, Yoga has indicated that the agency is requesting domestic crypto exchanges to submit their own regulatory proposals.

As the world’s fourth most populous country, Indonesia is essentially a cash-based economy with up to 80% of the population choosing not to use the banking system. This would seem a perfect ingredient for the establishment of a crypto-based economy, but clearly, the word isn’t out as yet. However, growth within the crypto space is growing according to Forbes.

Oscar Darmawan, CEO of Indonesia Digital Asset Exchange, has reported “exponential growth” in users of his platform over a period of two years from 50,000 members in 2015 to 500,000 members to August of 2017. According to Bloomberg, the exchange will have 1.5 million members buying and selling digital currencies such as Bitcoin, Ethereum, and Ripple by the end of the year.

 

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