On 12 January, Indonesian President Joko Widodo approved a new regulation that will allow the Indonesian Financial Services Authority (OJK) to oversee digital assets instead of the Commodity Futures Trading Regulatory Agency (CoFTRA). Consequently, crypto-assets will now be considered securities and, as such, fall under rules similar to those governing investment contracts. This change in the country's legislation marks a significant shift in attitudes towards digital currencies in Indonesia.
Asih Karnengsih, head of ABI's blockchain development community group, said in a press statement that this is the right move. The law aims to bring Indonesia's regulatory framework in line with the rapid changes taking place in the virtual asset sector. Karnengsich suggested that it could be a few years before there is a transition of authority from CoFTRA to OJK, so as not to cause a dramatic change in the local cryptocurrency landscape.
However, since the OJK is wary of cryptocurrencies, it is likely that they will be more strictly regulated than before. The institution has already repeatedly warned people about crypto-assets and reminded financial institutions not to use them.
Last autumn, the head of Indonesia's Central Bank noted that digital currencies could pose a risk to the financial system and motivated central banks to introduce their own digital currencies, prompting them at the time to develop the idea of a digital Indonesian rupiah due to increased demand.