Indonesia to toughen rules for crypto exchanges and provide more local control

People walk past advertising screens showing a ‘Zipmex’ crypto exchange platform in Bangkok, Thailand, July 27, 2022. REUTERS/Athit Perawongmetha

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JAKARTA, Sept 20 (Reuters) – Indonesia’s Ministry of Commerce plans to issue a new rule governing crypto asset exchanges, requiring two-thirds of the board and commissioners to be Indonesian citizens and resident in the country, said a deputy minister on Tuesday.

The move follows financial problems at Southeast Asia-focused cryptocurrency exchange Zipmex, which temporarily prevented users from withdrawing funds. Read more

“We don’t want to license (exchanges) lightly, so only those that meet the requirements and are credible,” Deputy Commerce Minister Jerry Sambuaga told reporters after a parliamentary hearing.

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The ministry’s Commodity Futures Regulatory Agency (Bappebti) will publish the new rule soon, he said, without giving a time frame.

It will also require an exchange to use a third party to store customer funds and prohibit exchanges reinvesting stored crypto assets, according to a document released by the ministry.

Acting Bappebti chief Didid Noordiatmoko told the parliamentary hearing that ensuring two-thirds of the board were Indonesians based in the country “could prevent management from running away when a problem hits the stock market”.

Asked about a plan to launch an Indonesian crypto asset exchange, which was delayed from last year, Sambuaga said the plan could hopefully be completed this year.

The cryptocurrency has gained popularity in Southeast Asia’s largest economy with total crypto asset trading volume rising over 1000% in 2021 to 859.4 trillion rupees (57.37 billion), according to data from Bappebti.

($1 = 14,980.0000 rupees)

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Reporting by Stefanno Sulaiman Editing by Ed Davies

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