Indonesia intends to grant some authority to the Financial Services Authority. The OJK will oversee market activity and regulate cryptocurrency investments. Currently, it’s the Commodity Futures Trading Regulatory Agency and the country’s Trade Ministry. The two work together to regulate the digital asset sector. Indrawati, the finance minister, declared that the nation would give OJK the authority. OJK will aim to safeguard consumer interests.
Concern About Indonesian Investors
The recent developments have impacted Indonesia’s intentions. These developments include the fall of FTX, one of the largest crypto exchanges in the world. Also, Terra’s downfall in May led to yet another fall, wiping out billions from the market.
The latest Indrawati proposal is part of comprehensive legislation. According to sources, she filed the legislation to the government earlier this year. Currently, the bill is being discussed in the national Parliament.
The finance minister said that Indonesia must impose stringent laws. These laws are to protect its financial sector tech innovation, including cryptocurrency assets.
She said that the cryptocurrency sector has recently experienced turbulence. She was alluding to the FTX saga, which began a week ago. All that started when leaked documents revealed illiquid exposures to various Altcoins.
Indonesian Investors Prefer Cryptocurrencies To Stocks
Indonesia has not yet accepted cryptocurrencies as legal money. But it does permit their usage in the commodity market for investment.
When presenting the new plan to Parliament, Indrawati had some remarks. She pointed out that there are more crypto investors than stock investors. In comparison to the 9.1 million stock investors, there are 15.1 million investors in digital assets. Only four million crypto investors were present in Indonesia in 2020. This is a significant rise over the previous two years.
She stated in a parliamentary hearing that there is a need to build supervision’s structure. Investor protection that is solid and trustworthy is also necessary. This is for financial assets that are high risk,” highlighting Bitcoin’s recent volatility.
the measure was submitted to the government by Parliament. The meeting on Thursday was to discuss the government’s initial reaction. Also, to talk about any amendments to the suggested measure. Once the provisions are approved by the legislative, the bill will be signed into law.
The recommendations made by the Parliament also include clauses. These clauses would expand the central bank’s mandate beyond price stability. All these aim to include economic growth.
Sri Mulyani emphasized the significance of financial regulators’ independence. She particularly pointed out BI’s independence and stated her support for the recommendations.